M&G seeds £74m private credit LTAF in part with with-profits cash

M&G Investments launched the Diversified Private Credit Feeder LTAF on 12 October, a £74m vehicle aimed at UK defined contribution schemes. That places the new fund inside M&G's private and structured credit business, which the newsroom's tracking puts at £28bn.

The fund was seeded in part by M&G's with-profits fund and sits inside M&G's £28bn private and structured credit platform. The 12 October entry is recorded as a fund launch, with the £74m given as the fund's size.

An LTAF, or Long-Term Asset Fund, is a UK vehicle structure designed for less liquid assets such as private credit. The wrapper exists precisely because daily-dealing fund formats fit poorly with loans that cannot be sold on demand, which is why the vehicle type is the one UK managers use when they want DC schemes as investors.

Drawing part of the seed from an insurer's with-profits pool rather than solely from third-party scheme money puts M&G's own balance-sheet capital alongside the DC assets the feeder is built to attract. Whether that seed is the whole £74m, or just a portion of it, is not stated in the tracking, and no target size or fundraising ceiling for the vehicle appears there either. The practical question for M&G is how quickly DC schemes follow the with-profits money into a structure whose whole design assumes they will not need their capital back quickly.