Meiji Yasuda to lift Man Group private credit commitment to $1.3 billion

Oct 26 (Reuters) - Japanese insurer Meiji Yasuda will raise its capital commitment in hedge fund Man Group's private-credit funds to 200 billion yen ($1.3 billion) and could acquire a 5% equity stake in the British group, the companies said on Monday. 

Shares of Man Group, which have gained roughly 42% so far this year, were up 4.6% by 0952 GMT.

The deal extends a growing trend of Japanese insurers partnering with British asset managers to increase exposure to private credit, attracted by higher yields than those available in traditional fixed income assets. 

It builds on a partnership between Meiji Yasuda and Man Group first announced in February 2025 and the Japanese insurer will allocate the increased capital to Man Group's private credit business over the next three years.

The firms did not disclose the previous investment but Panmure Liberum analysts said Meiji Yasuda made a 150 billion yen commitment.

"A large Japanese Life insurer putting its own capital behind Man’s private credit push is a useful vote of confidence as well as sticky flows," Panmure Liberum analyst Abid Hussain said.

Meiji Yasuda will acquire any equity stake in Man Group through open market purchases, the companies said.

Meiji Yasuda has been diversifying beyond government bonds and domestic equities to lift returns for policyholders. Last year, it acquired Legal & General's US protection business in a $2.3 billion deal, and bought a 5% stake in the British insurer.

Man Group and Meiji Yasuda will also jointly develop products for the Japanese market.

The push into private credit comes as the sector faces heightened regulatory concerns around limited transparency, inconsistent data and opaque valuation practices that regulators say could pose risks to broader financial markets.

($1 = 156.8100 yen)

(Reporting by Yamini Kalia in Bengaluru; Editing by Rashmi Aich and Emelia Sithole-Matarise)