Mid-market direct lender TPG Twin Brook Capital Partners and secondaries manager Coller Capital have closed a $3bn (£2.2bn) deal for a continuation fund, which is thought to be the largest transaction of its kind to date in the private credit secondaries market.
Continuation funds enable private credit managers to roll over an existing portfolio of assets into a new fund, providing some liquidity for existing investors while enabling managers to retain control of the assets.
TPG Twin Brook’s vehicle consists of floating-rate, senior secured, sponsor-backed loans from its 2016 and 2018 vintage funds. Its aim is to provide existing investors with an attractive liquidity option, and to offer new investors access to a diversified and high-quality pool of private credit assets.
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“We appreciated the opportunity to work closely with TPG Twin Brook to design a solution that delivered on multiple priorities: liquidity, alignment, and long-term capital,” said Jonathan Leu, principal at Coller Capital.
“The strong support we received validates our flexible, solutions-based approach, and we look forward to continuing to manage these loans through the next phase of their lifecycle,” said Trevor Clark, founder and managing partner of TPG Twin Brook.
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The firms say the deal also reflects increasing institutional demand for credit secondaries, with transaction volume growing as the broader private credit market continues to mature and expand.
Campbell Lutyens served as financial adviser on the transaction and Deutsche Bank provided financing for the transaction. Legal counsel for Coller Capital was provided by Debevoise & Plimpton, while Ropes & Gray acted for TPG Twin Brook.
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