Press Release|Funds

KBRA Affirms the Rating to BNP Paribas' Capital Call Facility for Crown Co-Investment Opportunities III Master SCSp

6 Jun 2025 | London

KBRA UK (KBRA) affirms the AA- rating assigned to a revolving loan facility (the "Facility") provided by BNP Paribas for Crown Co-Investment Opportunities III Master SCSp ("CCO III" or the "Fund"). The Outlook is Stable. The rating was requested by BNP Paribas. Neither LGT Capital Partners ("LGT CP") nor any of its associates has requested this report or the rating, and this report has not been prepared for or approved by any of them.

The Facility is a bilateral, multi-currency $185 million senior secured revolving credit facility, used for working capital and investment purposes including investments, hedging and fees. In April 2025, the Facility was reduced from $225 million to $185 million, and the duration was extended by one year to April 2026. The rating action reflects the stable credit quality and diversification of the limited partner (LP) base.

Since issuance of the rating, there have been top-ups and additional co-investors investing into the Fund, which are mainly LGT private bank clients and LGT CP employees which were not included in the previous investor base at issuance. Together with the FX impact, the Fund size has grown from $1,850.6 million to $2,053.8 million. This has further enhanced the diversification of the LP base, with the adjusted HHI improving from 16.1 to 18.7. The credit quality of the LP base has remained stable year-on-year with 90.9% of Included LPs evaluated to be equivalent to investment grade credit quality compared to 90.8% at issuance. Further, as of March 2025, the Fund has called 72.8% of total commitments, compared to 60.8% at issuance. With further deployment of the Fund, the Facility has decreased from $225 million to $185 million which has improved the asset coverage since issuance.

CCO III is the third vintage of LGT CP’s co-investment strategy, focused on buyouts in North America, Europe and opportunistically in Asia-Pacific. The Fund follows the investment strategy of its predecessor funds, building a diversified portfolio of co-investments alongside managers in LGT CP’s network. LGT CP is an alternative investment specialist offering a wide range of investment programs focusing on private markets, liquid alternatives and multi-asset class solutions. The core team began investing in private markets in 1997, and in November 2000, they founded LGT CP, based in Pfaeffikon, Switzerland. The founding team continues to be a key part of the Firm's senior management today, ensuring stability and consistency in its culture and approach. As of January 2025, LGT CP has more than $100 billion in assets under management, with offices in Switzerland, New York, Dublin, London, Vaduz, Paris, Frankfurt, The Hague, Luxembourg, Dubai, Beijing, Hong Kong, Tokyo, San Francisco and Sydney. LGT CP's team consist of over 880 professionals who serve more than 700 institutional clients in 50 countries.

Key Credit Considerations

Investment fund ratings are based on quantitative and qualitative factors. The five key quantitative determinants are as follows:

In the Asset Quality determinant, KBRA generally measures the quality of the collateral based on a weighted average scoring. For Subscription Facilities (“Sublines”), this includes an assessment using a matrix-based approach that reflects the creditworthiness of the Fund’s LP base.
The Asset Coverage determinant measures the relative sufficiency of the pledged collateral value to repay the principal amount of the rated debt. For Sublines, this includes an evaluation of the covenants included in the Facility linked to uncalled committed capital (UCC) and net asset value (NAV) of the Fund, and/or advance rates applied to the UCC.
The Liquidity determinant reflects KBRA’s assessment of the relative price discount that the underlying collateral may incur if the assets are subject to conversion into cash in order to meet scheduled or accelerated debt service requirements. Under the Liquidity determinant, KBRA considers three factors (type, complexity and price discovery / transparency) and scores these factors individually on a scale of zero to two, with two being the most liquid.
In the Duration determinant, KBRA examines the tenor profile of the pledged collateral relative to the rated debt, and the associated vulnerability to changes in price of collateral over time.
When appropriate, KBRA will perform a cash flow analysis in order to test the transaction’s ability to meet its rated interest and principal payment obligations under various economic, financial, and market scenarios. This is not applicable to Subscription Facilities, as LP capital calls typically occur on a non-periodic basis and the primary source of repayment for Sublines is the Fund’s UCC so once a capital call is issued, the LP is typically required to meet the capital call within a short window. Therefore, repayment capacity is analysed in the context of the prior rating determinants.

The above quantitative determinants produce a quantitative rating outcome. In addition to the above quantitative determinants, KBRA’s analysis considers a variety of qualitative factors, which can lead to upward or downward adjustments in the final rating outcome and these are assessed in the context of: (i) Manager Review; (ii) Legal Review, and (iii) Other Factors including alignment of interests, incentives to fund future capital calls and diversification within the LP base.

Rating Sensitivities

It should be noted that many aspects, including but not limited to, the rating sensitivities listed below, macroeconomic factors, market conditions, competitive landscape, and a fund manager’s investment acumen can impact the performance of the fund and influence KBRA’s rating decisions. If performance of the transaction differs meaningfully from the expected levels, KBRA may consider making a rating change.

Decline in LP Credit Quality

A decline in the credit quality of the Fund’s LPs as a result of: (i) deterioration in the credit quality of underlying LPs; (ii) transfer of interests to LPs of lower credit quality characteristics; (iii) inclusion of LPs with weak credit quality characteristics; and (iv) weaker than expected LP diversification, may result in negative rating changes.

Improvement in LP Credit Quality

An overall higher credit quality of the Fund’s LPs as a result of: (i) improvement in the credit quality of underlying LPs; (ii) transfer of interests to LPs with better credit characteristics; (iii) inclusion of LPs with strong credit quality characteristics; and (iv) stronger than expected LP diversification, may result in positive rating changes.

Underperformance of Fund Assets or Investments

A decrease in the Fund’s NAV due to underperformance of the Fund’s underlying assets or investments may jeopardise debt repayment as the deterioration of the Fund may, for example, elicit hesitation of the Fund’s LPs to fund their respective capital calls regardless of their contractual obligations to do so and the underlying LPs’ security and protections to the Lender.

This Press Release has been updated on 3 February 2026 to include certain information that is also found in the published Ratings Rationale Report relating to this transaction.