Coller Capital has successfully raised $2.4 billion for a groundbreaking structured secondaries vehicle, marking the largest transaction of its kind in the secondaries market, as reported by Bloomberg. The initiative has garnered support from major institutional investors, including Barings and Ares Management.

This vehicle is designed to acquire stakes in private equity and private credit funds from existing limited partners, highlighting the increasing demand for innovative financing solutions amid constrained liquidity in private markets. Barings is the primary investor in the senior debt tranches, while Coller and Ares will hold the first-loss equity positions, aligning their interests with the performance of the underlying portfolios.

Structured secondaries products, like the one launched by Coller, convert future fund cash flows into bond-like tranches with different risk and return profiles. This structure appeals to institutional investors, such as insurers and pension funds, who prefer rated instruments due to more favorable capital treatment under regulatory guidelines.

The transaction reflects a broader trend in fund finance activity, as general partners (GPs) seek structured solutions to unlock liquidity and manage portfolio duration amid slowing distributions to limited partners (LPs). These solutions include rated feeders and collateralized fund obligations.

Coller Capital's latest move signifies its evolution as a secondaries specialist with a focus on fund finance. The firm manages over $40 billion across various private market strategies, positioning itself among a growing number of managers innovating within the secondaries market.

The sector is increasingly attracting attention from asset managers eager to establish a presence in this rapidly evolving space. Recently, Bayview Asset Management announced key appointments to develop a new fund finance platform, underscoring the rising competition and demand from investors.