The Guardian Life Insurance Company of America has entered into a strategic partnership with global active asset manager Janus Henderson Group, which will manage a $45 billion investment grade public fixed income portfolio of corporate and securitized credit for Guardian.
The deal,an example of leveraging private credit flow, into the securitization market, is expected to close at the end of the second quarter of 2025.
Going forward Janus Henderson will be Guardian's unaffiliated fixed income, insurance asset manager. The goal of this multifaceted collaboration is to accelerate mutual market growth by aligning existing resources with market opportunities, noted Ali Dibadj, chief executive officer of Janus Henderson upon the announcement of the partnership.
Equity warrants are one example of the economic considerations the New York based mutual insurance firm Guardian will receive to support that goal.
Private credit expanded to approximately $1.5 trillion at the start of 2024, up from $1 trillion in 2020 and is estimated to soar to $2.6 trillion by 2029, according to David Miller, head of global private credit & equity at Morgan Stanley.
Increasing financing costs will keep pressuring some borrowers in older deals, but as bank lending gets tighter borrowers value the speed, certainty and flexibility of private credit solutions, Miller explained in a market commentary. He expects the overall credit quality seen in 2024 will persist and deal flow will continue to increase.
Factors driving private credit growth include refinancings from leveraged borrowers seeking better pricing; attractive yields, especially compared to public markets; and potential for growth in middle-market direct lending that could benefit collateralized loan obligation equity investors. In addition, increased competition will bring more scrutiny to credit quality.
Guardian and Janus Henderson plan to co-develop proprietary, multi-asset portfolio models for Guardian's registered broker-dealer investment advisor, Park Avenue Securities (PAS), according to the announcement.
The joint effort will focus on leveraging Janus Henderson's expertise in fixed-income, multi asset solutions and model portfolio platforms to ensure Janus Henderson expands its presence in the global institutional investment and insurance market, added Dibadj.
London based Janus Henderson's active fixed income ETF suite includes CLO ETF JAAA, exposure to floating-rate CLOs generally rated BBB, JBBB, and JSI, which focuses on the U.S. securitized markets.
The agreement will increase the amount of fixed income assets managed by Janus Henderson globally to $147 billion and grow its unaffiliated insurance assets under management to $109 billion.
Janus Henderson was represented by Mayer Brown's New York office team led by partner Joe Castelluccio and associate Don Irwin. Guardian was advised by Debevoise & Plimpton LLP.
