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Ver Capital SGR announces the launch of the diversified loan fund Ver Capital Credit Partners SMEs VII

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    Date: 12 December 2019

Ver Capital SGR has announced the launch of a diversified loan fund supporting Italian and European SMEs. The European Investment Fund will be a cornerstone investor, backed by the guarantee of the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe, or Juncker Plan.

The European Investment Fund (EIF) has committed up to EUR 35 million in Ver Capital Credit Partners SMEs VII (“VCCP SME VII” or the “Fund”), a Luxembourg-based alternative investment fund managed by Ver Capital SGR. The EIF commitment in the Fund was made under the “Private Credit Tailored for SMEs” programme. Launched in December 2018, the programme combines resources from the EIF and EFSI to aim at fostering private institutional investment in support of more market-based and tailor-made funding solutions for European SMEs and small mid-caps.

VCCP SME VII invests in a diversified portfolio of senior debt instruments issued to support medium to long-term funding needs of SMEs mainly based in Italy with use of proceeds typically devoted to growth, capex, event-driven transactions, and general corporate purposes needs. The Fund’s resources may also be allocated to French and German companies with the aim of enhancing VCCP SMEs VII’s diversification and further balancing risk-return profile.

In addition to its direct investment, EIF may also provide bilateral unfunded protection to new subscribers to the Fund. Interested investors may benefit from EIF’s covering up to 50% of their investment, with a potential total cap of approximately EUR 15 million, hence providing risk-mitigation and risk-adjusted return optimization. This protection instrument could encourage further commitments from smaller institutional investors, particularly insurance companies.

Ver Capital is targeting a hard cap commitment of EUR 300 million, expected to be invested in more than 50 loans to SMEs, and expects to deploy the Fund’s resources in a relatively short time frame.

VCCP SME VII starts from the experience of the previous Ver Capital Credit Partners Italia V, the existing closed-ended fund focused on the Italian private debt market launched in 2015 and reaps the benefits of Ver Capital’s 12 years of experience in both Private Debt, Euro Loans and High Yield markets. Over the course of its life, Ver Capital’s team has been managing 10 funds, 6 closed-ended funds and 4 open-ended, analysing more than 500 companies and investing more EUR 3 billion to date. Back in 2006 Ver Capital was one of the pioneers of the Italian Private Debt market and, since then, has developed a significant European experience in Euro Loans and Euro High Yield.  Ver Capital believes that a European-wide experience is key to provide local SME and investors with the best technical solutions.

In analysing the potential reference market of the new Fund, Ver Capital has identified about 12,500 companies with revenues between EUR 10 million and EUR 90 million, and quantitative financial metrics in line with Fund’s investment strategy. Furthermore, qualitative metrics such as a sound governance 

structure, high quality management and a rigorous reporting system will be additional conditions in order to be considered in the Fund’s portfolio selection. Furthermore, the Fund’s investment strategy is being implemented consistently with Ver Capital’s investment pillars that imply: 1) fundamental driven analysis based on proprietary model, 2) portfolio diversification, 3) efficient capital deployment (typical in all Ver Capital funds and crucial nowadays for all investors, particularly in the QE macro environment) and 4) strong independent origination and structuring capabilities.

Pier Luigi Gilibert, Chief Executive of the European Investment Fund, said: “Diversified debt funds offer small businesses an alternative to classic bank loans, including bespoke debt packages, speedy deployment and flexibility. This agreement represents a further step in the EIF’s strategy aimed at strengthening ties between institutional investors and the public policy objective of supporting the development and growth of SMEs and intermediate-sized companies in Europe. Our cooperation with Ver Capital Credit Partners - with the support of the Juncker Plan - demonstrates Europe’s strong commitment to improving access to finance for European entrepreneurs.”

Andrea Pescatori, Chief Executive of Ver Capital SGR, said: “We are very glad to welcome the European Investment Fund as a cornerstone investor in our VCCP SME VII and provider of a bilateral unfunded protection to new subscribers to the Fund. It has been a comprehensive due diligence process and we are now proud that the EIF's team has recognized our long-standing expertise in European corporate loans and  specific private debt experience in countries such as Italy, France and Germany l. Ver Capital's unique experience in corporate loans and rigorous investment approach, broad portfolio diversification, strong origination capability andand an efficient capital deployment strategy are some of the key VCCP SME VII's features that are creating a compelling interest among potential Investors. VCCP SME VII first closing is expected within Q1 2020 f"

Background information

The Investment Plan for Europe, known as the Juncker Plan, is one of the European Commission's top priorities. It focuses on boosting investments to create jobs and growth by making smarter use of new and existing financial resources, removing obstacles to investment and providing visibility and technical assistance to investment projects. The European Fund for Strategic Investments (EFSI) is the central pillar of the Juncker Plan. It provides a first loss guarantee, allowing the EIB Group to invest in more, often riskier, projects. The projects and agreements approved for financing under the EFSI so far are expected to mobilize more than EUR 450 billion in investments and support more than one million start-ups and SMEs across all 28 Member States.

The European Investment Fund (EIF) is part of the European Investment Bank group. Its central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.

Ver Capital SGR is an independent investment management company focused on European Corporate Debt (Bonds and Loans) and local Private Debt through both closed ended, levered and unlevered, and open-ended funds. Ver Capital is recognised by market participants as one of the main and recurrent investor in the European credit market and since its establishment in 2006, Ver Capital has managed 10 funds, analysed more than 500 companies and invested more than EUR 3 billion. Ver Capital AUM currently exceeds EUR 1 billion.

Press Contacts

EIF:
Tim Smit
+352 691 286423
t.smit@eib.org

 

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