Nest Corporation has appointed two fund managers to invest in private credit, enabling its eight million members to benefit from the sophisticated investments found in private markets. Amundi and BlackRock have been selected for their innovation and cost-efficiency following a highly competitive open tender, in which nearly 40 organisations applied.
Nest will initially be targeting about 5% in private credit but it will take some time to reach that target – the pension scheme doesn’t want to force money into the markets, said Stephen O’Neill, Nest’s head of private markets. The initial 12-month commitment will be around £400-500 million.
“Nest’s size and future growth helps negotiate great deals with fund managers, meaning our members can grasp with both hands the opportunities presented by private credit,” O’Neill stated, adding that the new fund managers are already sourcing loans in their respective markets and NEST expects them to begin deploying capital as soon as October.
These appointments follow NEST’s creation of a subsidiary company, Nest Invest, which if granted authorisation from the Financial Conduct Authority (FCA), will make it easier for the investor to secure co-investments in private markets. Nest Invest is seeking authorisation to become an FCA regulated Occupational Pension Scheme (OPS) firm. The FCA is expected to respond to Nest Invest’s submission later this year.