Capital Group, the parent company of American Funds, and private equity firm KKR plan to launch two public-private fixed-income investment products together next year. The products, the first in what Capital Group and KKR expect to be a series of hybrid public-private investments, will consist of 60% public and 40% private.
In the future, products launched by the partnership will be offered across multiple assets, geographic markets and distribution channels.
The firms offered scant additional details on these public-private investments, citing Securities and Exchange Commission regulations.
Mike Gitlin, president and CEO of Capital Group, said mixing public and private access to alternative assets should give individual investors more liquidity than they can get by putting their money into stand-alone private credit funds. The firm manages more than $2.6 trillion in equity and fixed-income assets globally.
KKR offers alternative investments that range from real estate and infrastructure funds to private equity and private credit funds.
“We believe individuals should have access to alternative investments and are thrilled to be partnering with Capital Group, which has world-class investment capabilities, strong client relationships and a leading sales and distribution network,” said Joe Bae and Scott Nuttall, co-CEOs of KKR, in a statement.
Eric Mogelof, partner and head of global client solutions at KKR, added that the hybrid public-private investment model should help more private wealth investors access alternative investments.