Private equity firms, including buyout major KKR & Co, are beginning to add hedge funds to their 'white lists' of approved lenders used to arrange funding for leveraged buyout deals, according to a report by Bloomberg.

Once considered too opportunistic, hedge funds are being recast as acceptable partners as other sources of funding become more scarce.

The report cites unnamed sources familiar with the matter as revealing that former Credit Suisse Group AG star trader Hamza Lemssouguer is among those to benefit from the change in attitude towards hedge funds, with his Arini fund having broken into the ranks of approved lenders via a new collateralised loan division. Other hedge funds including Cross Ocean Partners and Sona Asset Management, are taking similar CLO routes.

And traditional hedge fund are also gaining entry to the approved lenders clubs, according to Bloomberg, with Elliott Investment Management acting as an anchor investor to CVC for €1.5 billion ($1.6 billion) of loans to finance the buyout of tea business Ekaterra.