Capital Group, KKR Expand Partnership With Launch of Public-Private Credit Strategy in Europe and Asia

Capital Group and KKR are expanding their strategic partnership with the launch of a new blended public-private credit investment strategy aimed at wealth and institutional investors across Europe and Asia Pacific, as demand grows for diversified income solutions amid evolving global market conditions.

The new strategy, named Capital Group KKR Global Multi-Sector+ (GMS+), combines public and private credit exposures within a single investment vehicle, allocating approximately 60% to public fixed-income assets and 40% to private credit investments managed by KKR. The offering is designed for qualifying investors seeking enhanced yield opportunities, portfolio diversification, and improved risk-adjusted returns.

The launch marks the latest milestone in the collaboration between the two investment firms, which announced their strategic partnership two years ago. Since then, Capital Group and KKR have jointly introduced several hybrid investment products in the United States, including public-private credit and equity strategies aimed at expanding investor access to private markets.

The new GMS+ strategy will initially be distributed through HSBC Private Bank in selected markets across Europe and Asia. The fund will be managed by Capital Group, with KKR serving as sub-adviser for the private credit allocation.

The firms said the strategy is intended to bridge the gap between traditional bond portfolios and alternative investment products by combining the liquidity profile of public markets with the income-generating potential of private credit assets. The fund structure also includes monthly repurchase provisions of up to 3% of total assets, providing investors with a level of liquidity that exceeds what is typically available in conventional private credit funds.

The launch comes at a time when investors globally are increasingly turning toward private market assets as higher interest rates, market volatility, and tighter financing conditions reshape portfolio allocation strategies. Private credit, in particular, has emerged as one of the fastest-growing segments within alternative investments, driven by demand for higher yields and direct lending opportunities.

Guy Henriques, president of Europe and Asia Pacific Client Group at Capital Group, said the new strategy reflects the firms’ long-term commitment to delivering integrated investment solutions tailored to changing investor needs.

“When we announced our strategic partnership with KKR, we viewed it as the beginning of a broader collaboration focused on innovation and investor outcomes,” Henriques said. “This strategy is designed to provide investors with a comprehensive credit solution that sits between traditional fixed income and alternative investments, with the potential to enhance returns while reducing volatility through broader diversification.”

KKR executives emphasized the growing appeal of integrated public-private investment structures among wealth managers and institutional clients seeking scalable access to private market opportunities.

Eric Mogelof, partner and head of Global Client Solutions at KKR, said investors increasingly value simplified access to diversified strategies managed by experienced investment firms.

“Investors today are looking for more holistic portfolio solutions that can provide exposure across both public and private markets,” Mogelof said. “Through our partnership with Capital Group, we are combining decades of investment expertise and deep credit capabilities to create a differentiated offering for clients globally.”

HSBC Private Bank will serve as an initial distribution partner for the strategy in select regions, reflecting the increasing role global banks are playing in expanding private market access to high-net-worth and professional investors.

Lavanya Chari, head of Wealth and Premier Solutions at HSBC, said the collaboration aligns with rising investor demand for innovative investment approaches capable of navigating uncertain economic conditions.

“In today’s environment, investors are seeking more diversified and resilient portfolio strategies,” Chari said. “This partnership brings together leading public and private market expertise in a single investment solution that complements traditional portfolio allocations.”

The launch also underscores a broader industry trend in which asset managers are increasingly integrating private market exposure into mainstream investment products as the boundaries between traditional and alternative investments continue to narrow.

With private credit assets under management continuing to grow globally, analysts expect hybrid investment structures such as GMS+ to gain further traction among investors seeking income, diversification, and flexible portfolio construction in an increasingly complex market environment.

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