Armada Credit Partners closes fifth fund on €210m

Founded in 2000 and based in Stockholm and Helsinki, Armada provides private debt and equity to northern European SMEs. 

The GP told Unquote that it started raising the fund in 2018, but had to seek authorisation to fundraise in the rest of EU, which took longer than expected. 

Managing partner Ilkka Santti told Unquote that the pandemic had "certainly had an impact, as we weren't able to meet prospective investors physically".

He added that it also affected the appetite of investors. "I think it is easier to only look for new funds with no legacy portfolio than going into funds where they already have a portfolio that may be affected by the pandemic.  For instance, in our portfolio we have a burger chain in Sweden. One would imagine that it would be hit hard, but the absolute performance has been really good with sales growing strongly last year. Even so, its not easy for LPs to go to their investment committees and say we'd like to invest in Armada while one of their key investments is a restaurant business." 

Santti said the LPs that committed to the fund were attracted to the GP's track record and value proposition. "We're still able to make and demonstrate good returns while taking moderate risk, with part of the investment being senior loans, and then piggyback those deals by co-investing equity in deals alongside sponsors." 

Fund V is already 50% deployed and has made seven investments so far. 

The investment team of the GP committed €4m of their own capital to the fund. Elm Capital and Borenius advised Armada on the fundraising.

Investors
There were 14 LPs in the fund, primarily from Finland, and some from Spain and Luxembourg. They featured private and public pension funds, insurance companies, funds-of-funds, government agencies and institutions. EIF was one of the investors.

Investment strategy 
Fund V invests €5-30m in small and medium-sized growth businesses in the Nordic region and Germany. Its loans have a maturity period of five to seven years. 

Santti said: "We look at both the downside as well as upside, which makes us different from pure unitranche funds. We not only look at the risks but also the opportunities. That's one reason we're looking at growth companies, because we think its less risky to invest in them, and we like to provide capital whether for roll-outs or buy-and-build."

While the GP is sector agnostic, Santti said it has a lot of IT, tech and services companies, and avoids cyclical companies because "we always need to assume there will be some sort of a recession during the investment period".

It has already made seven initial investments, including 13:e Protein Import, Evondos, Global Attractions SPI, Bastard Burgers, and Origo Group. 

People 
Armada Credit Partners – Ilkka Santti (joint managing partner); Jan Wiklund (joint managing partner). 

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Debt
• Nordics
• Finland