15 Dec 2022
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AustralianSuper and Churchill Asset Management announce new lending partnership
AustralianSuper, Australia’s largest superannuation (pension) fund, today announced a new partnership with Churchill Asset Management (“Churchill”), with an initial instalment of US$250 million, intended to grow substantially over time. The partnership will invest in traditional senior and unitranche loans to private equity-backed U.S. middle market companies.
AustralianSuper has over US$4.5 billion (A$7 billion) committed to private credit globally, with an ambition to triple its exposure in coming years through a mix of direct lending by its in-house private credit team and strategic partnerships with best-in-class specialist managers such as Churchill.
Churchill is the US$42 billion private capital investment-specialist of Nuveen, the asset manager of TIAA2. Churchill has a proven 16-year track record of disciplined investing in middle market senior loans across economic cycles and is one of the most active lenders in the industry investing over US$14 billion annually. Most recently, Churchill ranked as the #1 “U.S. buyouts lender” in Pitchbook’s League Tables1.
AustralianSuper Head of Private Credit Nick Ward said the Fund is working with aligned managers that have strong long-term track records as it expands its global private credit exposure particularly in the US market.
“AustralianSuper is looking to work selectively with managers that can demonstrate disciplined performance across market cycles as we expand the US private credit portfolio,” Mr Ward said.
“Churchill has a strong long-term track record of market leadership, and we look forward to building a long-lasting partnership with the team at Churchill and Nuveen.”
Commenting on the partnership, Ken Kencel, President and CEO of Churchill said “We are excited to partner with AustralianSuper, a leading and well-respected global investor. Churchill’s partnership with AustralianSuper demonstrates our ability to develop customised investment structures that align with our clients’ priorities, allowing us to grow our third-party separately managed account business to nearly US$9 billion.”3
“We believe the opportunity in U.S. middle market senior lending continues to be very attractive, particularly given the floating rate nature of the investments, strong current income potential, significant lender protections and senior position in the capital structure. We look forward to helping AustralianSuper achieve its investment objectives by providing differentiated access to our directly originated, proprietary senior loan assets.”
AustralianSuper’s US$175 billion (A$260 billion) global investment portfolio is projected to more than double over the next five years. The Fund opened its New York office in 2021 and is recruiting a specialist US investment team focused on growing its private credit, private equity, infrastructure and property portfolios.
AustralianSuper was ranked as the 20th largest pension fund in the world earlier this year in the Watson Tower Wills Thinking Ahead Institute's Top 300 pension study.
Nuveen Managing Director, Head of Australia Andrew Kleinig welcomed the new partnership as an extension to the long-standing relationship between AustralianSuper and Nuveen.
“Nuveen’s investment specialists in the United Kingdom and Europe have been successfully managing mandates for AustralianSuper for several years now. We are pleased that through Churchill, we will be able to continue delivering for AustralianSuper and its members,” Mr Kleinig said.
AustralianSuper manages more than A$263 billion (US$175 billion) of members’ retirement savings on behalf of almost 3 million members from around 419,000 businesses. One in 8 working Australians is a member of AustralianSuper, the nation’s largest superannuation (pension) fund.
About Churchill Asset Management LLC:
Churchill, an investment-specialist affiliate of Nuveen (the asset manager of TIAA), provides customized financing solutions to middle market private equity firms and their portfolio companies across the capital structure. With US$42 billion of committed capital, we provide first lien, unitranche, second lien and mezzanine debt, in addition to equity co-investments and private equity fund commitments. Churchill has a long history of disciplined investing across multiple economic cycles and our unique origination strategy, best in class execution and investment are driven by more than 140 professionals in New York, Charlotte, Chicago, Dallas and Los Angeles. More information can be found at www.churchillam.com.
This material is not intended to be a recommendation or investment advice, does not constitute a solicitation to buy, sell or hold a security or an investment strategy, and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor or suggest any specific course of action. Financial professionals should independently evaluate the risks associated with products or services and exercise independent judgment with respect to their clients. Investments in middle market loans are subject to certain risks such as: credit, limited liquidity, interest rate, currency, prepayment and extension, inflation, and risk of capital loss.
Churchill Asset Management is a registered investment advisor and majority-owned, indirect subsidiary of Teachers Insurance and Annuity Association of America. Certain Nuveen products are advised by Nuveen Alternatives Advisors LLC, a registered investment advisor and wholly owned subsidiary of TIAA, and distributed by Nuveen Securities, LLC, Member FINRA and SIPC.1Source: Pitchbook Q2 2022 League Table
2At Q2 2022. More information here.
3At Q2 2022. More information here.