ICG upgraded to ’BBB+’ by Fitch on strong asset growth

Investing.com -- Fitch Ratings has upgraded ICG plc’s Long-Term Issuer Default Rating and senior unsecured debt rating to ’BBB+’ from ’BBB’ with a Stable outlook.

The credit rating agency cited ICG’s continued growth in fee-earning assets under management (AUM) as a key factor in the upgrade, along with improving balance sheet and cash flow leverage.

ICG, formerly known as Intermediate Capital Group (LON:ICGIN) plc, has built a robust asset management franchise that generates substantial recurring management-fee revenue, making earnings less dependent on net gains from co-investments.

The company’s fee-earning AUM reached $82 billion at the end of June 2025, providing good visibility of recurring management fees. ICG’s funds are predominantly closed-ended, with fees based on either committed or invested capital rather than fund valuation movements. An additional $20.1 billion of committed AUM within ICG’s total $112.4 billion (as of end-March 2025) will earn fees once invested.

Fitch highlighted ICG’s strong fundraising performance, with net client flows exceeding 7.7% of opening fee-earning AUM in each of the last four years. This growth has been supported by the company’s traditional strengths in areas like private debt, along with an expanding range of investment strategies.

The firm’s financial position has also improved significantly. ICG’s gross debt to tangible equity ratio decreased to 0.5x at the end of fiscal year 2025 from 0.7x a year earlier. Its Fitch-calculated gross debt to FEBITDA pre-incentive scheme costs ratio improved to 3.0x from 4.3x during the same period.

ICG maintained strong earnings in fiscal year 2025, with pre-tax profit remaining above £500 million, supported by core management fees exceeding £600 million. Performance fees grew by 17% to £86 million during the period.

At the end of March 2025, ICG had available cash of £548 million net of regulatory liquidity requirements, plus an undrawn £550 million revolving credit facility. The company also had $32 billion available for new investments.

Fitch noted that while the global investing environment faces some volatility due to inflationary pressures and weak economic growth, valuations have remained relatively resilient.

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