Aviva Investors has acquired the Adriana Infrastructure CLO as it looks to expand its private debt platform and increase its non-bank lending capabilities.
The collateralised loan obligation is backed by a diversified portfolio of UK public-private partnership and private finance initiative infrastructure loans.
Established in 2008, Adriana already has a longstanding relationship with Aviva Investors, which has invested in the vehicle’s senior notes since 2013.
The acquisition will enable the asset manager to expand from its existing infrastructure and private debt activities into securitised real-asset investments.
SECURITISED REAL ASSETS
Infrastructure CLOs remain a specialist part of the global securitisation market, with Aviva Investors saying relatively few transactions have been completed and most activity to date concentrated in the US dollar market.
The company believes there is scope to develop the UK and European market by combining institutional capital with infrastructure and real-asset lending and securitisation.
It plans to develop further securitisation structures, including CLOs backed by infrastructure and other real-asset loans.
Munawer Shafi, head of structured and private debt at Aviva Investors, says: “The acquisition of the Adriana CLO represents a major strategic step for our private debt platform and strengthens the relationship we have had with the CLO for more than a decade.
“Although CLOs have historically been associated with corporate lending, we believe infrastructure-backed CLOs provide investors with attractive diversification beyond traditional corporate exposures, while offering the flexibility to tailor risk and return profiles to suit investors’ needs.”
NON-BANK LENDING
Aviva Investors says the vehicle will also allow it to increase infrastructure debt origination, including in the sub-investment-grade market.
Darryl Murphy (main picture), head of infrastructure at Aviva Investors, says: “Infrastructure debt continues to present attractive opportunities across a wide range of risk profiles, spanning both investment-grade and sub-investment-grade markets, where we are already an active lender in both UK and Europe.
“The new CLO vehicle will enable us to scale our origination capabilities further, particularly in the sub-investment-grade segment and with greater investment flexibility.
“By combining our infrastructure lending expertise with structured finance solutions, we can further strengthen our position as a leading non-bank lender in this asset class.”
