Initial $750 million fund being raised as challenging economic conditions set stage for higher borrower demand
A newly launched Toronto-based investment firm with an office in Montreal is raising its first-ever fund aimed at lending institutional capital to high-quality Canadian mid-market businesses.
With its initial $750-million Senior Secured Direct Lending Fund, Private Debt Partners (PDP) is aiming to build a Canadian multiple-sector portfolio of long-term, fixed-interest rate, senior secured loans to high-quality companies.
“Private corporate debt has been one of the fastest-growing alternative asset classes and one of the best investments on a risk-return basis,” said Jeffrey Deacon, founder and managing partner of PDP. “We expect alternative debt instruments will be even more vital to fuel the economic recovery while providing institutional investors with diversification and reliable, consistent income.”
Co-founded by a team of veterans — including Deacon Greg Dimmer and his fellow managing partners Jean-Christophe Greck, who have together directly originated over $1 billion in loans — PDP benefits from 35 years of combined experience in loan origination portfolio management, underwriting, and fundraising in Canada.
In a statement, the firm noted that institutional investors are looking for more reliable yields against a backdrop of market uncertainty and high volatility. At the same time, more opportunities are expected within the private-lending space, with mid-market firms requiring patient capital and better terms compared to those offered by traditional lenders.
PDP’s first fund will extend loans to companies identified based on strong market positions, management teams, and financial performance. Targeting yields between 6% and 6.5% for its investors, the fund will originate loans with customised terms for borrowers, including term limits up to 10 years and flexibility in amortization.
“We have established PDP with a ‘best-in-class’ approach to all aspects of our business, including governance and state-of-the-art technology, loan management and reporting,” said Tom MacMillan, chair of PDP's Investment Committee.
“We have structured PDP to directly align with the needs of investors and borrowers, which is fundamental to delivering the consistent yields that investors seek and the patient capital that borrowers rely on,” MacMillan added.