Slovenian ALFI Private Debt fund raises EUR 41 million with EU support for investments in Slovenian and Croatian SMEs

• ALFI PD will use the newly raised funds to finance Slovenian and Croatian SMEs through its private debt fund
• The EIF is one of the main investors in this call, backed by the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe.
• The Fund has already completed more than EUR 10 million investments in 15 SMEs in Slovenia, while the Fund has after the subsequent closing started to focus on the Croatian SME’s and expects to execute first investment in the following months.

The European Investment Fund (EIF), part of the European Investment Bank Group (EIB), will provide up to EUR 40 million to the Slovenian ALFI Private Debt Fund to unlock a new source of financing for Slovenian and Croatian small and medium enterprises (SME). The EIF investment is backed by the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe. The EIF is one of 11 institutional and private investors in ALFI PD in this call, through which the Fund raised a total of EUR 41 million for its SME investments.

ALFI PD is a manager of alternative investment funds established as a joint venture between Slovenian KF Finance and Trigal, backed by the German asset manager KGAL and Zavarovalnica Triglav, leading financial-insurance group in Slovenia and the wider Adria region and one of the largest insurance groups in South-East Europe.

The EIF commitment stems from the “Private Credit Tailored for SMEs” programme established in 2018 to provide fresh financing for European SMEs by combining resources from the EIF and the European Fund for Strategic Investments (EFSI). The EIF managed programme fosters private institutional investments in support of more market-based and tailor-made funding solutions for European SMEs and small mid-caps.

Chief Executive of the EIF, Alain Godard, said: “EIF is delighted to continue with our support for Slovenian and Croatian SMEs and their growth and development. Our latest investment in ALFI Private debt fund as the first regional fund under the Private Credit Tailored for SMEs” programme will unlock new financing options for Slovenian and Croatian SMEs offering flexible and tailored made solutions to support their plans. Our partnership with ALFI PD is a step forward to ensure appropriate and professionally developed alternative financing market, which is key to improve access to finance in Slovenia and Croatia and create an economy capable of successfully competing across the globe.”

Commissioner for the Economy, Paolo Gentiloni, said: “With the Investment Plan for Europe, we are supporting market-based and tailor-made funding solutions for businesses, so they can maintain and grow their operations and support jobs. The ALFI PD fund, backed by the Investment Plan and the EIF, is a great example: it will offer new financing opportunities for Croatian and Slovenian SMEs and thereby strengthen the local economy.”

Rok Ambrožič Miha Štepec, partners at ALFI PD, said in a joint statement: “In the current challenging environment for any start up fund in the region, even more so now during the pandemic we are extremely satisfied to have reached this important milestone, while we are also honoured to have European investment fund and Triglav Insurance Company as the corner investors. We are proud of the returns, which we have made for our investors while also being very glad that we were recognized by the SMEs as a credible and professional provider of alternative tailored made financing solutions. All of this is setting a solid basis to reach the final target size of EUR 80 million in the next 6 months.“

David Benedek, Board member at Triglav, said: “We are delighted to support ALFI Private debt fund as this enables us on one hand to further diversify our investment portfolio and on the other hand provide valuable financing alternatives to SMEs in our home markets of Slovenia and Croatia. We have been a corner investor in ALFI PD since 2019 and are extremely satisfied with the development and results of the fund thus far.”

The Fund will invest primarily in small and medium firms through senior secured debt and support their growth strategy. The EIF also supports ALFI PD in attracting private capital from both domestic and international investors to the lower end of the market and crowding in new investors.

Expanding financing options for SMEs key for globally competitive economy

ALFI PD aims to secure up to EUR 80m for investments in more than 80 companies and contribute to long-term sustainable development and increased competitiveness of SMEs in Slovenia and Croatia.  The Fund activities unlock new, previously unavailable financing options to local SMEs allowing them to choose the best financing option for their investment plans.

This kind of opportunity puts Slovenia and Croatian companies on equal footing with their competitors working in more developed financial markets and at the same time accelerates the COVID-19 recovery of SMEs, among the parts of the economy most severely impacted by the pandemic in both Slovenia and Croatia.

Background information:

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.

About the EFSI Private Credit Tailored for SMEs Programme:

The European Fund for Strategic Investments (EFSI) has been the central pillar of EU financing and investment support and was significantly redirected in 2020 to support EU businesses impacted by the COVID-19 crisis. The projects and agreements approved for financing under the arm of EFSI implemented through the EIF are so far expected to mobilise almost EUR 232 billion in investments and support more than 1.4 million start-ups, SMEs, and mid-caps across all EU Member States. The Private Credit Programme under EFSI makes cornerstone investments in funds that provide alternative, flexible and tailor-made debt financing for businesses.

About Triglav Insurance:

Zavarovalnica Triglav headquartered in Ljubljana is a public limited company founded in 1900. Zavarovalnica Triglav is the controlling company of the Triglav Group, which is the leading insurance/ financial group in Slovenia and the Adria region as well as one of the leading groups in South-East Europe with a leading market share in the Adria region. The group employs more than 5,300 employees, has a balance sheet of more than EUR 4 billion and has an »A« credit rating assigned by S&P Global Ratings and AM Best, with a stable medium-term outlook.

About ALFI PD:

ALFI PD is a leading regional private debt fund headquartered in Ljubljana. In accordance with its investment strategy fund is focused on supporting Slovenian and Croatian SMEs with flexible and tailored made financing products. Fund was established in 2019 and is part of the ALFI Funds. ALFI Funds are leading regional alternative investment funds, with more than EUR 250 million of commitments and more than EUR 150 million invested in the segments of distressed debt, private equity, private debt, RE and renewables.   

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