SMBC is making another push into the direct lending market, this time with a maiden €450 million fund, according to a company statement.
The fund, the company said, will provide direct, senior-secured loan investments to middle-market private equity-backed businesses in Europe operating in resilient sectors, and will invest alongside SMBC Group’s balance sheet-driven private credit business including its joint venture with Park Square Capital, which was set up in 2017.
SMBC said it has been able to raise the capital from a diverse group of limited partners including secondary and strategic investors in Europe, the Middle-East and Asia Pacific. Sumitomo Mitsui DS Asset Management Co., Ltd. which is also an SMBC Group company, is participating in this fund as an LP investor.
The European Middle Market Credit Fund was established through a transaction comprised of a secondary purchase of a strip of investments held on SMBC Group’s balance sheet, which forms a seed portfolio of high-quality, performing loans, alongside a primary capital commitment. The deal was led by Pantheon’s private credit secondaries business.
Campbell Lutyens’ secondary advisory team, Clifford Chance and PwC advised SMBC Group on the transaction.
“The fund is an important step in the development of our private credit business in Europe and complements well the range of financing solutions we can offer private equity backed companies in the middle market,” said Dan Matthews, head of EMEA leveraged finance at SMBC Group.
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