There is nothing dull about being a corporate lender these days. The loans business is migrating away from the beleaguered banking sector. Long-dated insurance premiums are becoming the funding of choice. The shift is sufficiently seismic that once overlooked credit firms are now the subject of bidding wars.
Legacy capital managers do not want to be caught flat-footed. Take Blue Owl Capital’s recent acquisition of Kuvare Asset Management for $750mn, which eventually could reach $1bn. It is a serious price for an asset manager that is only a decade old and manages $20bn. Blue Owl itself manages $165bn for a juicy market capitalisation of just above $20bn. But Kuvare has established itself as a canny specialist in the bespoke assets that life insurers invest in.
Kuvare joins a growing trend. A few weeks earlier, Japan’s Dai-ichi Life Holdings took a stake in Canyon Capital, a $20bn credit manager that made its name as a distressed and opportunistic debt expert. Within a few years, Dai-ichi will have the chance to acquire all of Canyon. Last year, private equity stalwart TPG attempted to jump on the insurance bandwagon by acquiring the credit specialist Angelo Gordon for $2.7bn.