First Trust Enhanced Private Credit Fund Converting to Interval Fund Structure

First Trust Capital Management L.P. is converting its Enhanced Private Credit Fund from a tender offer fund to an interval fund structure, with a public offering for both share classes set to launch May 4, 2026.

The fund’s primary objective is to achieve total return through a combination of income and capital appreciation. Under normal market conditions, the fund allocates at least 80% of its net assets to private credit instruments.

That allocation includes privately negotiated and broadly syndicated corporate loans across the capital structure, asset-backed securities, collateralized loan obligations, significant risk transfer securities and revolving credit facilities.

As an interval fund, the fund will provide limited liquidity to shareholders through semi-annual repurchase offers of no less than 5% and no more than 25% of its outstanding shares. It expects to conduct its initial repurchase offer in June 2026, with subsequent offers occurring semi-annually on or about June 30 and Dec. 31.

If a repurchase offer is oversubscribed, the fund said it may repurchase shares on a pro-rata basis, meaning investors may be unable to liquidate their entire position during a specific window.

The fund filed an effective amended prospectus reflecting the structural change. Class I shares commenced operations July 1, 2024. A public offering of both Class I and Class A shares is set to launch May 4, 2026.

The interval fund also maintains a distribution policy targeting a 10.5% annual distribution rate based on NAV. However, the fund said the rate is subject to modification by its board and that distributions in excess of earnings and profits will be treated as a return of capital, which may impact a shareholder’s cost basis.

Class I shares, designed for institutional and fee-based advisory accounts, have no upfront sales load and no ongoing distribution fees. The minimum investment is $1 million.

Class A shares, available to retail investors, carry an upfront sales load of 4.5% and ongoing distribution and service fees of 1% annually. The minimum investment is $1,000.

The fund charges a management fee of 1% and an incentive fee of 15% of pre-incentive fee net investment income exceeding a monthly hurdle rate of 0.42% (5% annualized). Income below the hurdle carries no incentive fee. A catch-up provision applies to income between 0.42% and 0.49% monthly, with the full amount in that band payable to the investment adviser.

Fee Breakdown by Share Class
Total Annual Fund Operating Expenses (Gross)

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