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2025 Highlights
The team saw strong activity throughout 2025, with notable momentum in Real Assets across the DACH region and the Nordics including district heating and digital infrastructure.
Companies and sponsors increasingly valued access to local currency long-term debt (15-30 years), and showed continued interest in institutional financing, appreciating the diversification and stability offered by non-bank partnerships.
Private Placements
Both new and existing issuers drove private placement activity across a variety of sectors. Trusted relationships, stability in funding structures, and PGIM’s ability to support businesses through market cycles were frequently cited as key reasons companies chose to partner with us as an institutional lender.
Shelves remained a popular lending mechanism, providing pragmatic, short-notice access to long-term maturities, in contrast to shorter-term bank financing. Funding needs driving deployment included refinancing, acquisition bridge lines, and M&A.
Direct Lending
Despite lower levels of M&A activity, sponsor-backed transactions continued to drive Direct Lending activity, with investment teams seeing solid flow of opportunities across the DACH and Nordic regions. There was a good mix of sponsored transactions, and we also saw more unique non-sponsored opportunities. Borrower profiles remained diverse, with companies possessing attractive fundamentals drawing the most attention.
PGIM’s pan-European platform and local relationships provided direct access to borrowers, supporting continued opportunities in a challenging environment.
Real Assets
Real Assets issuance was driven primarily by renewables, digital infrastructure, transportation, district heating grids, and conventional power such as gas-fired and energy-from-waste power plants, which contributed to sustaining the strong levels of originations that we’ve seen across DACH and the Nordics over the past few years.
The team expects further growth, with increasing infrastructure investment activity anticipated across Europe, including core and digital infrastructure, utilities, renewables, and conventional power generation. Of note, increased renewable energy generation will require storage, power plants for peak supply, and improved power grids.
Outlook for 2026
We maintain a cautiously optimistic outlook for 2026 in the region.
In Direct Lending, there is a broadly expected increase in M&A activity in 2026 and debt maturities in 2026-27, both of which will likely result in opportunities. We are well positioned to support this growth, with our suite of funds allowing for flexible structuring across senior, unitranche, and junior financings.
In private placements, the ongoing global political and economic uncertainty will likely drive demand for diversification and certainty in capital structures, with corporates continuing to value diversification beyond banks, long-term, fixed rate institutional financing and the flexibility of Shelf agreements.
Infrastructure opportunities are set to expand across all categories including power-related, core, and digital infrastructure. We expect that governments will push this across Europe and institutional financing providers can provide leverage on government funding.
Overall, the team anticipates robust demand for institutional financing and positive momentum as European growth indicators improve.
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