Lincoln Financial Joins Evergreen Fund Arms Race
The competition among asset managers to launch evergreen funds—open-end funds that typically feature lower minimums, simplified tax reporting and limited liquidity—continues at a white-hot pace.
The latest asset manager to throw its hat in the ring is Lincoln Financial, which offers annuities, life insurance, group protection and retirement plan services. The firm has teamed with Bain Capital and Partners Group to launch two new private funds that are expected to become effective later this year.
Notably, one of the offerings will touch on an asset class that has not been featured much in evergreen structures to date: royalties. For the Lincoln Royalties Income Fund, the firm is teaming up with Partners Group. Partners will follow a “relative value” approach and invest across royalty sectors, such as intellectual property assets in the pharmaceutical and entertainment industries and emerging high-growth sectors like energy transition, sports and brands. The fund will look to employ a range of structures, including direct purchases of royalties, creating royalties and lending against royalties.
Evergreen funds—interval funds, tender-offer funds, BDCs and non-traded REITs—have rapidly become the vehicle of choice in the wealth channel for gaining exposure to alternative investments. According to consulting firm XA Investments, interval funds and tender offer funds saw a 21% increase in number and a 35% increase in managed assets during 2024. Overall, the firm said there were 257 total funds (124 interval funds and 133 tender offer funds) with a combined $172 billion in assets, with about 60% in interval funds, as of the end of 2024. In addition, there are more than 50 funds in the registration process with the SEC.
“Our 20-year plus track record in managing bespoke evergreen solutions and deep expertise in private markets royalties, coupled with Lincoln’s market-leading distribution capabilities, provide strong foundations from which to deliver a very impactful private markets solution,” Nicholas Hegarty, managing director and co-head of client solutions Americas at Partners Group, said in a statement.
Meanwhile, Lincoln has also partnered with Bain to create a private credit fund, Lincoln Bain Capital Total Credit Fund, that will include direct lending, asset-based finance and structured credit.
“This collaboration is a natural extension of Lincoln’s long-standing partnerships with top-tier asset managers and furthers our ability to provide consultative support for financial professionals to meet the evolving needs of their clients.” John Kennedy, executive vice president, chief distribution & brand officer for Lincoln, said in a statement.
“The private market investment strategies we have deployed through our multi-manager framework have enabled us to drive value within our own investment portfolio,” Jayson Bronchetti, executive vice president and chief investment officer for Lincoln, said in a statement. “We are thrilled to leverage our asset management relationships and investment and fund structure expertise to create private market funds for our customers to invest directly into these strategies with Bain Capital and Partners Group.”
“By combining our deep expertise in private markets with Lincoln’s innovative, expansive distribution platform, we can further expand access to private markets for more investors,” John Wright, partner and global head of credit at Bain Capital, said in a statement.
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