M&G buys majority stake in European non-public credit score agency | USAEMALL.com

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M&G has acquired a majority stake in a European private credit firm as chief executive Andrea Rossi attempts to lead the UK-based asset manager further into private markets.

The London-headquartered fund group has bought 70 per cent of Swedish company P Capital Partners, which has about €3.8bn in assets under management, in the largest deal for M&G since Rossi took the helm in late 2022.

The deal is the latest evidence of asset managers investing more heavily in private credit in order to diversify and attract higher returns, as customers continue to withdraw money from listed equity funds.

It also marks the second transaction in a week in which a UK fund has increased its exposure to private markets, after the UK’s state-backed pension scheme pledged to invest £5bn with Australian infrastructure giant IFM Investors.

“We want to become the leader in private assets in Europe,” Rossi said. “Europe remains a growing opportunity when it comes to private credit. The US is rather overcrowded.”

The move adds to the £19bn M&G has invested in private and structured credit, which forms part of the group’s total £73bn exposure to private markets, spread across fixed income, alternatives, real estate and infrastructure.

P Capital Partners is focused on lending directly to entrepreneurs, family-owned businesses, and companies focused on sustainable technology — such as environmentally-focused infrastructure — across Europe.

The private credit sector has grown over the past decade as banks retreated from certain types of lending following the 2008 global financial crisis and the subsequent tightening of bank regulation.

Institutions including asset managers have been increasing their allocations to the $1.5tn global private credit sector by about 10 per cent a year, according to S&P Global Intelligence. Assets under management are forecast to reach $2.6tn by 2029, according to data provider Preqin.

Funds backing private assets tend to charge higher fees than public market products. However they also expose clients to risks including opaque valuations and limited liquidity. In 2023 the Bank of England warned that private credit markets remained vulnerable to “sharp revaluations”.

Fund groups increasing their exposure to unlisted assets include BlackRock, Franklin Templeton, and Capital Group in the US, and Amundi, Legal and General, and Schroders in Europe.

While some asset managers, such as M&G, Franklin Templeton and BlackRock have made acquisitions — the latter agreed to buy private infrastructure giant Global Infrastructure Partners last year for more than $12.5bn in cash and stock — others have focused on partnering with specialist alternative groups.

According to a 2025 survey by Aviva Investors, more than half of the 500 global institutions in its report expected to increase their private markets allocations over the next two years, while three quarters expect private markets to outperform public markets over the next five years.

“If you ask any asset manager out there, in their top three priorities, everyone will say they want to grow in private assets,” Rossi added.

Rossi said even though there can be “additional risk”, that is where “you get the premium” and higher returns. He added that he expected the European private credit sector to grow by double digits in the coming years.