Capital Group and KKR are launching an investment strategy blending public and private markets assets focused on credit, split 60% public / 40% private, called Capital Group KKR Global Multi-Sector+ and targeting investors in the Europe and Asia regions.
The approach will offer a single fund structure for qualifying investors. The launch reflects increasing demand from investors and wealth advisers for strategies that can deliver diversification and performance. In this case, the fund will allocate the 40% to private credit assets managed by KKR.
This is not the first joint launch of its kind involving the two entities. They have previously launched two public-private credit strategies and one public-private equity strategy in the US.
GMS+, the fund, will initially be available through HSBC Private Bank in select markets. It is managed by Capital Group and sub-advised by KKR. Monthly repurchases will be offered up to 3% of the fund, to facilitate liquidity above that typically found in private credit funds.
Guy Henriques, president, Europe and Asia Pacific Client Group, Capital Group, commented: “When we announced a strategic partnership with KKR two years ago we said it marked the start of our long-term collaboration. Today, we’re extending that commitment by bringing our first public-private strategy to investors in Europe and Asia Pacific. GMS+ is a whole-of-credit solution designed to sit between traditional bond funds and alternative investments, offering the potential for enhanced returns, lower volatility and greater diversification.”
Eric Mogelof, partner and head of Global Client Solutions at KKR, commented: “Having a single access point to invest at scale across public and private markets with world-class managers is a compelling value proposition. Through our strategic partnership with Capital Group, we are demonstrating the power of delivering a holistic solution that combines our firms’ near 150 years of investment leadership, deep expertise in credit investing, a shared commitment to education and client service.”
Lavanya Chari, head of Wealth and Premier Solutions, HSBC, commented: “In the current environment, professional investors are looking for more comprehensive ways to diversify portfolios and pursue differentiated outcomes. Our collaboration with Capital Group and KKR reflects HSBC’s commitment to connecting clients with innovative solutions that bring together leading public and private market capabilities within a single, integrated investment approach – enhancing diversification and complementing clients’ existing portfolio allocations.”
