Man Group snaps up private credit fund Varagon Capital to boost access to US market
Man Group has acquired a controlling stake in US middle market manager Varagon Capital Partners for $183m.
The London-listed fund said Varagon’s emphasis on insurances brings “significant institutional credibility” to support Man Group’s expansion in US private credit.
Varagon, which specialises in senior secured loans in non-cyclical industries, delivered compound AUM growth of 13 per cent in the three years to 2022 and generated $30.9m in pretax profit last year.
Eric Burl, head of discretionary at Man Group, said: “This acquisition reflects our long-term strategy to move into new market segments where we can differentiate ourselves with talented, specialised teams.
“Man Group has built a rich and diversified credit offering to date, and as client demand for credit strategies is increasing, we see a significant growth opportunity in direct lending, particularly against the backdrop of regional banking difficulties in the U.S,” he continued.
Boss of Varagon Walters Owens will continue to manage the business while its investment team will remain unchanged.
“The private credit market continues to grow in relevance for many investors, and fundamental credit analysis and disciplined underwriting skills will come to the fore as the environment for borrowers in the U.S. becomes more challenging,” Owens said.
Investors have moved back to Man Group as jitters have eased in recent months.