Franklin Templeton has closed its first Collateralized Fund Obligation, raising $1.5 billion from global investors and establishing a new capital formation channel for the firm’s private markets platform.
The transaction, Franklin Templeton Structured Solutions 2026, L.P., is designed to provide diversified exposure to private markets strategies spanning private equity secondaries, continuation vehicles and U.S. middle-market direct lending.
The underlying strategies are managed by Lexington Partners and Benefit Street Partners, two of Franklin Templeton’s specialist alternative investment businesses.
Lexington Partners contributes exposure to private equity secondaries and continuation vehicles, while Benefit Street Partners provides exposure to U.S. middle-market direct lending.
The CFO spans multiple investment vintages and a broad range of underlying portfolio companies, giving institutional investors a structured way to access several parts of Franklin Templeton’s private markets platform through a single vehicle.
Franklin Templeton Investment Solutions will serve as collateral manager for the transaction.
The platform will apply its experience across portfolio construction, liquidity management and risk management spanning both public and private markets.
Franklin Templeton sees the transaction as a response to growing investor demand for private markets strategies delivered through structures that can provide broader diversification, scalability and capital efficiency.
The CFO also creates another way for Franklin Templeton to distribute its private markets capabilities across institutional and wealth channels.
The firm expects structured private markets solutions to become increasingly relevant to investors including registered investment advisers, family offices, insurance companies and wealth distributors.
Franklin Templeton reported approximately $295 billion in alternative assets under management as of July 31, 2026.
Its broader alternatives platform includes Lexington Partners in private equity secondaries and co-investments, Clarion Partners in private real estate, Benefit Street Partners in private credit, Franklin Ventures, hedged strategies and digital asset capabilities.
Lexington Partners has more than $84 billion of total capitalization and has operated in the institutional secondary private equity market for more than three decades.
Benefit Street Partners manages approximately $94 billion in assets, including Apera, across strategies spanning private debt, real estate debt, structured credit and liquid loans.
The inaugural CFO further expands Franklin Templeton’s private markets distribution architecture as the firm seeks to combine specialist investment platforms with structured products that can reach a wider range of investors.
Franklin Templeton manages approximately $1.80 trillion in total assets as of July 31, 2026 and operates in more than 35 countries.
Evercore served as structuring advisor and placement agent for the transaction. Simpson Thacher & Bartlett served as issuer counsel.
KEY QUOTES:
“We are seeing growing demand from clients for access to differentiated private markets strategies in structures that are efficient and scalable. This inaugural CFO is a direct response to that demand, combining the specialized expertise of our private markets managers into an offering that reflects the full breadth of what Franklin Templeton can deliver.”
George Stephan, Global Chief Operating Officer, Wealth Management Private Markets At Franklin Templeton
“This transaction demonstrates how structured solutions can bring together different private markets capabilities to address the evolving needs of institutional portfolios. It draws on the breadth of Franklin Templeton’s private markets platform and our continued focus on developing innovative solutions that help clients achieve their outcomes.”
Jake Williams, Co-Head Of Private Markets Product At Franklin Templeton
