Alcentra closes European direct lending fund on €5.5bn

Oscar Geen
22 July 2019

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Private debt manager Alcentra has closed its latest European direct lending fund on тЌ5.5bn, surpassing its тЌ3bn target.

Its predecessor held a final close on €4.3bn in 2017 and had an average ticket size of around €100m.

The new fund will invest in mostly sponsor-backed mid-market companies across Europe, focusing on senior debt investments. It has the flexibility to invest between €20-300m with the average ticket expected to be similar to its predecessor at around €100m.

Alcentra also has capital available in separately managed accounts and may offer credit co-investments on larger deals, according to co-head of European direct lending Graeme Delaney-Smith.

Delaney-Smith added that the core focus is on credit fundamentals at a time when people are saying the market is hot and we have reached a late stage in the credit cycle.

The vehicle has a 10-year total life and four-year investment period, and expects to deploy mostly in western Europe, across the UK, France, Benelux, DACH and Nordic markets with some exposure to southern Europe as well.

The fund attracted a broad range of institutional investors from Europe, the Middle East, the US and Asia, and offers both levered and unlevered compartments.