Franklin Square Launches New Feeder Fund to Access Global Credit Strategy

Jun 8 2016 | 10:05pm ET

Liquid alternatives specialist Franklin Square Capital Partners has announced the launch of a new feeder fund for its FS Global Credit Opportunities Fund (FSGCO), an unlisted closed-end fund, that responds to new regulatory guidelines on certain direct participation programs and unlisted real estate investment trusts.

The new feeder fund, named FS Global Credit Opportunities Fund–T, features a commission structure designed to meet FINRA Regulatory Notice 15-02 guidelines by lowering upfront commissions and increasing the amount of capital available to the fund for investment. 

In a similar vein, Franklin Square is planning to launch FS Global Credit Opportunities Fund–ADV, a fund designed for use in advisory accounts, in the coming weeks, according to the company. 

FSGCO seeks to generate a high level of total return through investing in value-based and event-driven opportunities in a broad range of debt securities in North American and Western European markets, the firm said. As of March 31, it managed approximately $1.5 billion in assets and is managed by an affiliate of Franklin Square and sub-advised by GSO Capital Partners.

“We see tremendous opportunity to capitalize on dislocations in credit markets,” said Michael Forman, chairman and CEO of the fund. “FSGCO provides investors efficient access to a leading credit investment platform to execute on this strategy, and we designed FSGCO–T and FSGCO–ADV to expand their options.”

Founded in Philadelphia in 2007, Franklin Square listed its inaugural non-traded BDC fund on the New York Stock Exchange in April 2014, marking the first such liquidity event for a non-traded BDC. The company has since become a leading manager of alternative investment funds that provide access to asset classes, strategies and managers typically available only to sophisticated institutional investors. As of March 31, 2016, the firm managed approximately $17.0 billion in total assets, including $15.4 billion in BDC assets.

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