CPP Credit Investments Provides $300M for Värde Finance Platform

The Canadian pension giant Canada Pension Plan Investment Board’s CPPIB Credit Investments subsidiary is providing $300 million in strategic equity capital toward the launch of a new fund finance platform from Minnesota-based alternative investment firm Värde Partners Inc.

According to Värde, the platform intends to match the growing demand for subscription lines—also known as sublines—and other fund finance-related products. The firm’s fund finance strategy aims to support banks in addition to meeting borrower demands for more structured financing solutions, both of which are expected to expand lending capacity to the market.

CPPIB Credit Investments is a wholly owned subsidiary of CPPIB and is comprised of six investment groups: Americas structured credit and financials, Americas leveraged finance, public credit, real assets credit, European credit and APAC credit. The unit operates as a private equity firm and invests in private debt, loans and other investments.

“As demand for fund financing grows, we view subline lending markets as a compelling opportunity for investors like CPP Investments with long-term capital available for deployment,” David Colla, head of CPP Investments’ capital solutions group, said in a statement.

The investment is the Canadian pension giant’s first this year, following alts sales over the past three months. Earlier in June, CPP Investments sold a 50% interest in a portfolio of office properties in Western Canada to Oxford Properties Group for C$730 million ($531.6 million). It also announced in early June the sale of a 7.51% minority stake in 407 Express Toll Route, a 108-kilometer, electronic toll highway north of Toronto, to the Public Sector Pension Investment Board.

In April, CPP sold a portfolio of 25 limited partner positions in North American and European buyout funds to Ares Management Private Equity Secondaries funds and CVC Secondary Partners.

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Tags: Canada Pension Plan Investment Board, CPPIB Credit Investments, private lending, Värde Partners Inc.