Key Takeaways
- • HPS Investment Partners closed Strategic Investment Partners V, its flagship junior capital solutions fund, at $17 billion in total commitments, exceeding its $9.5 billion equity target.
- • The fund represents the fifth vintage of HPS's junior capital strategy, which has deployed over $36 billion since inception in 2008, with the current fund having already invested approximately $6 billion across 24 investments (37% deployment rate as of March 2023).
- • Major institutional investors committed capital including the Louisiana Teachers' Retirement System ($25 million), Minnesota State Board of Investment ($100 million), and Virginia Retirement System ($350 million), reflecting continued confidence from public pension funds.
- • The closure brings HPS's total assets under management to approximately $100 billion, positioning the firm as a scaled platform for subordinated debt and customized financing solutions across North America and Western Europe.
- • The fund targets established businesses in non-cyclical sectors, sourcing investments directly from private and public companies as well as private equity-backed businesses, with HPS emphasizing speed of execution and capital preservation as differentiators.
Summary
HPS Investment Partners has successfully closed Strategic Investment Partners V, the fifth vintage of its flagship junior capital solutions strategy, at $17 billion in total investable capital. The fund significantly exceeded its initial $9.5 billion equity target, demonstrating substantial institutional appetite for HPS's subordinated debt and junior capital offerings in the current market environment. As of March 2023, HPS has deployed approximately $6 billion across 24 investments, representing a 37% deployment rate of the fund's total commitments.
The fund attracted commitments from a diverse base of institutional investors, including major U.S. public pension systems. Anchor investors included the Louisiana Teachers' Retirement System ($25 million), Minnesota State Board of Investment ($100 million), and Virginia Retirement System ($350 million). This diversified investor base reflects the confidence institutional allocators place in HPS's track record and platform capabilities.
Strategic Investment Partners V is the latest closing in a strategy that has accumulated over $36 billion in deployments since its 2008 inception. The fund maintains HPS's established investment thesis of providing customized financing solutions to established businesses across North America and Western Europe. Deal sourcing focuses on both private and public company sponsors as well as private equity-backed businesses, with particular emphasis on resilient, non-cyclical sectors that demonstrate defensive characteristics.
According to Scot French, governing partner and portfolio manager, "the current market environment presents a rich set of opportunities" as companies increasingly seek strategic financing partners capable of delivering bespoke solutions with execution certainty. CEO Scott Kapnick highlighted the firm's differentiation strategy, emphasizing tailored risk-return solutions for institutional investors constructing private and tradable credit portfolios while maintaining a disciplined focus on capital preservation. The successful close brings HPS's total assets under management to approximately $100 billion, underscoring its position as a scaled alternative credit manager serving the world's largest institutional investors.
The fund attracted commitments from a diverse base of institutional investors, including major U.S. public pension systems. Anchor investors included the Louisiana Teachers' Retirement System ($25 million), Minnesota State Board of Investment ($100 million), and Virginia Retirement System ($350 million). This diversified investor base reflects the confidence institutional allocators place in HPS's track record and platform capabilities.
Strategic Investment Partners V is the latest closing in a strategy that has accumulated over $36 billion in deployments since its 2008 inception. The fund maintains HPS's established investment thesis of providing customized financing solutions to established businesses across North America and Western Europe. Deal sourcing focuses on both private and public company sponsors as well as private equity-backed businesses, with particular emphasis on resilient, non-cyclical sectors that demonstrate defensive characteristics.
According to Scot French, governing partner and portfolio manager, "the current market environment presents a rich set of opportunities" as companies increasingly seek strategic financing partners capable of delivering bespoke solutions with execution certainty. CEO Scott Kapnick highlighted the firm's differentiation strategy, emphasizing tailored risk-return solutions for institutional investors constructing private and tradable credit portfolios while maintaining a disciplined focus on capital preservation. The successful close brings HPS's total assets under management to approximately $100 billion, underscoring its position as a scaled alternative credit manager serving the world's largest institutional investors.
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