FCA approves private debt-focused LTAF

The Financial Conduct Authority (FCA) has granted regulatory approval for Arcmont Asset Management and Carne Global Fund Managers (UK) to launch a Long-Term Asset Fund (LTAF) focused on private debt.

The open-ended LTAF will be launched by Arcmont and aims to provide an element of liquidity to investors and exposure to European direct lend opportunities via a Luxembourg fund, with Carne acting as the LTAF’s authorised corporate director.

Through the LTAF, a range of investors, including defined contribution (DC) pension schemes, will be offered an alternative to fixed income investments.

Arcmont stated that the fund would offer schemes an opportunity to diversify their portfolios through exposure to private debt, thereby tapping into the illiquidity premium available in private markets.

The firm added that this was the first LTAF to be offered by a private debt asset manager.

Commenting on receiving approval from the FCA, Arcmont chief executive officer, Anthony Fobel, said the company was “delighted” to be the first dedicated European private debt manager to obtain regulatory approval to launch an LTAF.

“This new structure, authorised by the UK’s FCA, presents a solution for UK DC pension scheme investors, who were previously restricted in their ability to access direct lending strategies,” Fobel continued.

“The strong support for our Direct Lending Fund IV is evidence of the fact that global investors now recognise the attractiveness of private debt as a reliable and flexible source of capital for many companies.

“We believe that our size, scale and pan-European network, backed by Nuveen’s global platform, means that we are well positioned to continue to deploy capital as a partner of choice.”

Carne Group director, business development, Ben van den Tol, added: “We are delighted to be working with Arcmont to bring this product, the first of its kind, to market.

“As DC pension fund managers increasingly turn to private markets to drive enhanced risk adjusted returns for members, we are seeing growing interest in the LTAF structure, with investors recognising the compelling benefits the structure can bring in providing investor exposure to the private markets opportunity.”

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