MA Financial signals year’s first big float with $300m for a listed private credit trust

MA Financial is well advanced with its plans to raise about $300m for a listed credit trust, which sources say is likely to be the first big float of 2025.

MA Financial’s joint chief executives, Julian Biggins and Chris Wyke.

MA Financial plans to raise about $300m for a listed private credit trust as the asset management and advisory firm pushes further into debt and credit markets, and targets managing $15bn by the end of 2026, sources say.

The Australian can reveal plans for the first big float of 2025 are well advanced and MA has started contacting potential investors about the capital raising, as it lays the groundwork for the new trust.

An MA spokesman declined to comment when asked about the new fund’s details. MA, which is led by joint chief executives Julian Biggins and Chris Wyke, had $9.9bn in assets under management at the end of the September quarter last year – up 11 per cent on the same period in 2023.

That quarterly update flagged that the company was investing in “future growth initiatives”, although spending related to that would slow in the second half of 2024.

The same update also signalled that MA was seeking to diversify sources of investor equity and was planning to launch a private credit trust.

In the diversified credit space, MA’s existing investment funds include vehicles spanning credit income, credit opportunities, global private credit and priority income. In a presentation to investors last year, MA said its capabilities were in asset-backed loans, specialty credit and corporate debt.

Non-bank lenders like MA are expanding into areas such as debt financing and private credit, as major banks’ risk appetite has reduced in some parts of the market.

The Reserve Bank estimates there is $40bn in private credit outstanding in Australia, or about 2.5 per cent of total business debt. It’s an area that is expected to grow further, despite concerns about potential defaults if interest rates remain higher for longer.

Real estate funding provider Centuria Bass Credit on Monday said it had expanded its debt warehouse facility with an additional $100m commitment from UBS.

In August, MA announced the launch of a new institutional real estate credit vehicle with private equity firm Warburg Pincus and separately a strategic partnership with ASX-listed Humm Group. The real estate credit vehicle was pitched at $1bn-plus, while the Humm partnership was outlined as a $1bn financing partnership.

The move with Warbug Pincus is designed to address the persistent funding gap for developers as they seek to build new sites as the supply of new housing falls behind. The need for alternative sources of capital has prompted a boom in private players getting into the market.

Players include funds manager HMC Capital, led by former banker David Di Pilla, which is setting up a $5bn private credit business and bought specialist commercial real estate lender and funds house Payton Capital last May.

MA isn’t the only financial services and real estate group pushing into listed and unlisted investment funds to boost its assets under management and recurring revenue.

Real estate investment firm Qualitas has a stable of funds it manages including the listed Qualitas Real Estate Income Fund. Its unlisted vehicles include a senior debt fund, tactical credit fund and low carbon debt fund.

Lender and asset manager Metrics, which oversees about $21bn, provides investors access to private debt partly through listed funds. They are the Metrics Master Income Trust, the Metrics Income Opportunities Trust and the Metrics Real Estate Multi-Strategy Fund.

The firm’s investment options also include unlisted wholesale funds spanning areas such as secured private debt, a credit trust and senior loans.

MA’s portfolio of businesses also includes mortgage broking aggregator Finsure that has managed loans of $128bn and a direct home lending and finance unit that has a loan book of more than $1.7bn.