Manulife Raises $752M for Junior Credit Fund

Manulife Investment Management has closed on $752 million for its seventh fund, which will invest in junior credit capital in US middle market companies. The fund contains an undisclosed contribution from Manulife.

Since the private credit program’s inception in 1998, the firm has invested $3.3 billion in 126 companies. The strategy intends to give investors contractual cash coupons as well as capital appreciation, with an 80/20 yield to equity upside target.

“Our investment approach includes a target mix of subordinated and second-lien debt and structured and common equity that allows for meaningful participation in growth that is balanced by the potential for double digit yield,” said Josh Liebow, co-head of junior credit at Manulife Investment Management.

Liebow serves as the fund’s portfolio manager, working alongside Matt Szwarc, co-head of junior credit. The fund will target 20 to 30 portfolio companies with EBITDA of more than $20 million in industries such as business services, industrial manufacturing, and aerospace and defense.

Manulife Investment Management is the global wealth and asset management segment of Manulife Financial Corporation, a Canadian multinational insurance company and financial services provider.

Its global private equity and credit platform currently has more than $25 billion in assets under management and unfunded commitments across primary private equity funds, equity co-investments, GP-led secondaries, senior credit and junior credit.

Manulife recently purchased CQS’s $13.5 billion credit division and appointed BlackRock’s Anne Valentine Andrews as global head of private markets this month.