Alternative financing in private markets

Alternative debt covers a broad spectrum - from trade and asset-backed finance through to government supported opportunities, derivatives strategies and private asset-backed securities (ABS). We offer clients a route to accessing corporate and financial risk via bespoke and non-vanilla products aiming to capture value compared to public markets. Working in partnership with clients, we invest in transactions across a broad range of sectors, credit ratings and tenors, through sterling, euro and US dollar- denominated transactions.

Trust and long-term partnerships are key for banks and intermediaries opening borrower relationships and programmes to institutional investors. In this regard, LGIM is well placed, courtesy of its highly regarded and trusted brand across the marketplace. The team has developed strong relationships with market participants, which, we believe, will be key to sourcing future transactions.

Case studies

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Swap repackaging transactions

Swap repackaging transactions involve the transfer of inflation-linked derivatives exposures held by a bank to an institutional investor better suited to holding long-dated assets. They typically involve highly rated regulated utility companies with the credit exposure ranking in line with, or often senior to (super- senior), their highest-ranking debt.

We have participated in many such investments including a super-senior swap repack with underlying exposure to a UK regulated water company. The transaction repackaged swaps, with upcoming break clauses, into a debt instrument with inflation-linked amortising cashflows matching our clients’ inflation-linked liabilities.

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Capital Call Facilities (CCFs)

CCFs are senior short-dated loans (typically 12 months) to private investment funds that are secured against their legally binding investor (Limited Partners or LP’s) commitments as well as any fund assets. This helps private funds smooth their drawdown profile for LPs as well as providing bridge financing for any acquisitions and have a very robust track record for lenders.

We have invested in CCFs through a bespoke solution with a partner bank that is relevant for both Solvency II and non-Solvency II investors.

Other asset strategies

Corporate debt

For private corporate and public sector entities seeking to borrow outside of the public markets, we specialise in providing bespoke debt financing across a variety of sectors, structures and geographies.

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Infrastructure debt

We provide debt financing across four key infrastructure sectors: energy, transportation, digital and social.

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Real estate debt

Drawing on LGIM’s position as one of the UK’s largest and most experienced property investors, we provide expertise in senior loans secured against a broad range of property sectors.

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Private credit

Partnerships designed to deliver real social and economic impact

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Get in touch

The Real Assets Solutions team operates right across the entire LGIM Real Assets platform. With more than 100 years of combined industry experience, our 14-strong team draws on the expertise of former investors, consultants and product specialists.

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Key risk

The value of any investment and any income taken from it is not guaranteed and can go down as well as up,
and investors may get back less than the amount originally invested.