Art Penn Quoted in Bloomberg Article

Private Lender PennantPark Boosts Opportunistic Debt Firepower (January 26, 2021)
By Kelsey Butler – Bloomberg

Middle-market lender PennantPark Investment Advisers LLC has closed an opportunistic credit fund that will capitalize on volatility in the wake of the coronavirus pandemic.

The close, along with the recent formation of PennantPark Senior Loan Fund I LLC, ups the firm’s investment capacity by about $750 million, according to a Tuesday statement. PennantPark Credit Opportunities Fund III LP is the fourth vehicle in the strategy, focused on higher-yielding senior secured first-lien and second-lien loans, mezzanine debt, and equity coinvestments to U.S. companies.

Private debt investments provide “consistent absolute returns in a low-yield environment while also capitalizing on attractive opportunities during times of market volatility,” founder Art Penn said in the statement, adding that the coming “post-Covid vintage” will be particularly attractive.

One of PennantPark’s business development companies formed a joint venture in August with the private credit business of Pantheon Group to form PennantPark Senior Loan Fund. Pantheon invested $35 million to acquire a 28% stake from the BDC in a vehicle that held $356 million in senior loans at fair value.

Other firms in the $850 billion private credit space have also turned their attention to opportunistic debt in the midst of the current health crisis. The California State Teachers’ Retirement System late last year allocated $1 billion to the strategy via Owl Rock Capital Partners, while 400 Capital
Management and Arena Investors have recently closed funds to capitalize on market dislocation.

New York-based PennantPark is a middle market lender with $3.5 billion in assets under management.