Nuveen Churchill Private Capital Income Fund
I
Churchill Asset Management LLC
04/13/23
04/13/23
$363.7M
$2.5B
Core
New York, NY
Accredited
Monthly
15%
0.75%
Permanent Capital
Churchill Asset Management LLC
PwC LLP
Eversheds Sutherland LLP
Strategy
The Nuveen Churchill Private Capital Income Fund (the “Fund”) seeks to generate attractive risk-adjusted returns primarily through current income while secondarily seeking long-term capital appreciation, by investing in a diversified portfolio of private debt and equity investments in U.S. middle market companies owned by leading private equity firms. The Fund expects to target an investment portfolio consisting, directly or indirectly, of at least 50% Senior Loan Investments, up to 30% in Junior Capital Investments and up to 20% in Equity Co-Investments. The portfolio currently include a majority of First Lien Senior Secured (73% of portfolio), Mezzanine Debt (17%), Second Lien Senior Secured (8%), and Other (2%). The Fund aims to generate monthly distributions through focused allocation to senior secured loans while seeking long-term capital appreciation through an equity co-investment strategy.
Style
| Value | Core | Growth | |
| Large | |||
| Mid | |||
| Small |
Score Breakdown
BULLS SAY
Parent Company Commitment: With the initial $263 million seed capital investment from TIAA in place, investors may benefit from near-term distributions.
Experienced Team: The Senior Loan Investment Team is led by the members of the Senior Loan Investment Committee, who average over 27 years of middle market lending experience.
Firm's Access: Churchill has existing relationships with over 400 middle market private equity funds and significant advisory board representation.
Class I Fee Structure: Class I shares will not be subject to any upfront sales load or ongoing shareholder servicing and/or distribution fees.
BEARS SAY
High incentive fee: 15% incentive fee on income (subject to 6% hurdle rate & catch-up) paid quarterly and 15% incentive fee on capital gains paid annually.
Junior capital investments: The Fund expects to invest up to 30% in junior capital investments, debt securities with lower priority relative to the senior debt tranches.
Interest Rate Risk: A change in interest rates may result in changes to the fund net investment income.
Funding of distributions: Distributions may also be funded in significant part, directly or indirectly, from sources other than cash flow from operations, including the sale of assets, borrowings, return of capital or offering proceeds.
Managers
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Industry Experience 35 years of investment experience.
Career highlights Previously, he founded and was President and CEO of Churchill Financial Group; and served as Head of Leveraged Finance for Royal Bank of Canada as well as Head of Indosuez Capital—a leading middle market merchant banking and asset management business in partnership with Credit Agricole Group.
Education B.S. in Business Administration from Georgetown University, J.D. from Northwestern University Pritzker School of Law.
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Industry experience 30 years of investment experience.
Career highlights Kelli Marti serves as Churchill’s CLO Portfolio Manager and is responsible for the management and growth of Churchill’s middle market CLO platform, including day-to-day vehicle oversight, assisting in the sourcing of assets and trading strategy development, as well as participating in fundraising initiatives.
Education B.S. in Accounting from the University of Notre Dame, M.B.A. from the Kellogg School of Management at Northwestern University.
Full Review
BELOW AVERAGE
The large commitment from the parent company shows great alignment with investors, but is offset by the premium incentives fee charged by the fund.
The Fund charges a 15% incentive fee on net investment income (subject to 6% hurdle rate & catch-up) paid quarterly and 15% incentive fee on realized gains paid annually. The incentive fee is on the high end for this vehicle when compared to similar funds.
Additionally, the Fund charges a 0.75% management fee per annum on NAV, but waived the selling commissions, dealer manager fee, and Stockholder servicing fee/trailer (ongoing) on class I shares. Please note, these fees are only waived for class I shares.
AVERAGE
The Fund offering presents average potential for performance. The Fund currently holds 68 investments in its portfolio and is diversified across various sectors. Since inception, the Fund has generated a total return of 5.76%. And the Fund is on track to achieve its stated primary objective—generate income—in almost 12 months the fund has generated a 9.8% annual distribution yield.
Additionally, the investment and management team of a Nuveen Churchill Private Capital Income Fund has long-standing market presence, ability to invest in size, strong relationships with private equity firms, sourcing capabilities, and ability to compete on factors other than pricing. A majority of the Senior Loan Investment Committee have worked together for more than 15 years, focusing exclusively on originating, underwriting and monitoring middle market senior loans. During this time, the team has developed deep relationships with hundreds of private equity sponsors and has become a preferred partner to them. Dedicated origination professionals source deal flow from these long-established sources, allowing Churchill to review upwards of 1,000 Senior Loan opportunities per year.
Please note, the Fund intends to invest in securities that are rated below investment grade by rating agencies or that would be rated below investment grade if they were rated. Below investment grade securities, which are often referred to as “junk,” have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal. They may also be illiquid and difficult to value.
ABOVE AVERAGE
The fund will operate in a highly competitive market for investment opportunities, which could reduce returns and result in losses. The fund primarily invest in illiquid debt and equity securities of private companies. Most of its investments do not have a readily available market price, and are valued at fair value as determined in good faith by our Board of Trustees.
ABOVE AVERAGE
The Board of Trustees has the authority, except as otherwise prohibited by the 1940 Act, to modify or waive certain operating policies and strategies without prior notice and without shareholder approval. The fund will not hold controlling equity interests in the majority of its portfolio companies, and may not be able to exercise control over its portfolio companies or to prevent decisions by management of its portfolio companies, which could decrease the value of our investments.
ABOVE AVERAGE
All of the assets may be invested in illiquid securities, and a substantial portion of its investments in leveraged companies will be subject to legal and other restrictions on resale or will otherwise be less liquid than more broadly traded public securities. The fund does not intend to list Common Shares on any securities exchange, and does not expect a secondary market in its Common Shares to develop.
ABOVE AVERAGE
The fund intends to use leverage, which will magnify the potential for loss on amounts invested. The Fund may also hold the debt securities of leveraged companies that may, due to the significant volatility of such companies, enter into bankruptcy proceedings.
ABOVE AVERAGE
The management team provides investors with with annual reports containing audited financial statements, quarterly reports, and such other periodic reports as determine to be appropriate.
Most updates are accessible on Nuveen Churchill's website, making it easy for prospective investors to seek information about the fund's strategy, performance, and investment process. The Fund also offers investors relations contact information for both investors and financial professionals.
Peer Group
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|---|---|---|---|
| Vehicle name | Nuveen Churchill Private Capital Income (Class I) |
Blackstone Private Credit Fund (Class I) |
Carlyle Tactical Private Credit Fund (Class I) |
| Minimum investment | $1,000,000 | $1,000,000 | $250,000 |
| Holding period | Permanent capital | Permanent capital | Permanent capital |
| Annual management fee | 0.75% | 1.25% | 1.00% |
| Performance fee | 15% | 12.5% | 15% |
| NOYACK® Score |
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