Private credit carve-out from JPMorgan filed ‘secret’ IPO plan

investmentnews.com:

HPS Investment Partners, the private credit firm carved out of JPMorgan Chase & Co. in 2016, confidentially filed for an initial public offering, according to people with knowledge of the matter.

The firm submitted its registration to the Securities and Exchange Commission more than a year ago, said one of the people, who asked not to be identified discussing information that isn’t public. As a result of that filing, HPS is positioned to pursue a listing if equity capital markets become more favorable, said another of the people.

HPS has come to personify the remarkable rise of private credit as a usurper of traditional Wall Street lending. In 2016 the firm bought itself out of JPMorgan in a complicated deal valuing it at close to $1 billion. As it wrestles today with the idea of a public listing, it could be worth roughly eight times that amount. Assets under management have grown from $34 billion in 2016 to over $100 billion.

HPS, which has been considering whether to follow rivals including Ares Management Corp. and Blue Owl Capital Inc. in going public, could be valued in a listing at about $8 billion, Bloomberg News reported this week. The firm has been working with JPMorgan and Goldman Sachs Group Inc. on the effort, the people said. The timing of a listing hasn’t been determined, they said.

Representatives for HPS, JPMorgan and Goldman Sachs declined to comment.

The firm has raised several multi-billion dollar funds this year including its $12 billion Junior Debt Fund and its $7.3 billion Senior Direct-Lending Fund, and engaged in some of the largest transactions in the industry to date.

For more than a decade the founding trio of HPS — Scott Kapnick, Scot French and Mike Patterson — have been at the vanguard of