CVC Credit raises €350m for debt fund

The new funds will be used to invest in the sub-investment grade European debt markets. The placing comprised 175 million Euro-denominated shares at €1 each and 151 million Sterling-denominated shares, also at £1 each.

The fresh funding will be incorporated into the existing CVC European Credit Opportunities (CEC) fund, which is domiciled in Luxembourg.

The new funds will invest in up to 40 companies with an EBITDA of €75m and above. Around 25% of the fund is also believed to have been earmarked for future debt investments in the portfolio companies of CVC Capital Partners.

The debt vehicle will focus predominantly on senior secured loans for the sub-investment grade markets, but will also consider investments through a variety of debt packages including high-yield bonds and mezzanine debt.

CVC appointed Goldman Sachs International as sponsor, global coordinator and bookrunner for the placing. Dexion Capital was appointed lead placing agent.

"The investment mandate is popular with new investors because it offers a healthy degree of investment freedom giving the manager the ability to invest in opportunistic trades," explained Robin Bowie, founder of Dexion.

"A large part of the portfolio, around 60%, is in loans, which pay interest by means of a floating rate note coupon linked to LIBOR rather than a fixed interest rate, which means that if interest rates rise, investors benefit from the increase," said Bowie.

The shares are expected to start trading on the London Stock Exchange on 25 June under the ticker symbols CCPE (Euro) and CCPG (Sterling).

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• CVC Credit Partners
• CVC Capital Partners