TPG (TPG) Morgan Stanley US Financials, Payments & CRE Conference 2024 summary

Integration and business priorities

• Integration of the acquired Angelo Gordon business is proceeding smoothly, with operational decisions completed and businesses operating seamlessly.

• Focus is on accelerating capital formation, leveraging existing LP relationships to address undercapitalization in credit strategies.

• Significant global outreach has been conducted to engage LPs and explain the acquisition's strategic rationale.

• LPs are receptive to the expanded platform, especially in lower middle market direct lending and credit solutions.

• The integration and capital formation process is expected to continue through 2024 and 2025.

Credit platform developments

• Lower middle market direct lending is differentiated by tighter covenants and less competition from banks, providing early warning on credit issues.

• Credit Solutions business is seeing record opportunity flow, with 120 NDAs signed for bespoke refinancing deals.

• Structured Credit is benefiting from clients shifting fixed income exposure to private markets, especially non-EBITDA credit.

• Origination capacity is at a historical high, with Twin Brook on a $4 billion run rate and potential for 20% AUM growth without new capital.

• Large, scalable opportunities exist across all credit platforms, with ongoing capital raising and co-investment strategies.

Revenue and expense synergies

• A new hybrid opportunity strategy has been launched, targeting $1–1.5 billion in capital and mid-to-high teens returns.

• The strategy leverages both PE and credit teams, with no incremental hiring required.

• Identified $30 million in cost efficiencies, with much of the savings reinvested in growth areas like capital formation and private wealth.