Candriam Buys Stake in $3 Billion Private Credit Firm Kartesia

(Bloomberg) -- Candriam and its affiliate New York Life Investments Alternatives are taking a minority stake in the 2.5 billion-euro ($3 billion) credit specialist Kartesia Management SA, with investor appetite for private debt forecast to double in coming years.

The two firms will own 33% of Kartesia, according to Naim Abou-Jaoude, chief executive officer of 128 billion-euro multi-asset manager Candriam.

“Why Kartesia? It has built a successful business, establishing a strong market presence and an excellent track record,” Abou-Jaoude said in a video interview.

Kartesia provides private capital, mostly debt, of 10 to 50 million euros to small and mid-market businesses in Europe, according to its website. Money from the stake sale will allow it to expand into new regions and funds, said Jaime Prieto, one of Kartesia’s co-founders.

The deal will also offer access to a wider investor pool, something the firm had been seeking.

“In the short-term we could have remained independent. In the medium-term, you need to be able to capitalize on the shift away from banks into alternative credit managers,” he said. “You need a very strong distribution network.”

The deal comes at a time of strong investor appetite for private debt. Data provider Preqin forecasts that such funds will manage $1.46 trillion by 2025 -- up from around $848 billion in October.

This demand is spurring dealmaking and partnerships. Dyal Capital Partners this month entered merger talks with private credit manager Owl Rock Capital Partners LP, while Abu Dhabi sovereign wealth fund Mubadala Investment Co. recently teamed up with Barings for a direct lending platform in Europe.

Kartesia shares top-ranked status as the most consistent top-performing European private debt manager by Preqin. It will join a more than $30 billion stable of alternative investment firms at NYLIA that includes Madison Capital Funding, which has exposure to the U.S. private debt markets.

“The best managers have to have the most relevance. This partnership, for all three parties, increases their relevance in their respective markets and with their respective investors,” said Christopher Taylor, CEO of Madison Capital and head of NYLIA.

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