Alcentra, the alternative fixed income specialist of BNY Mellon Investment Management, has held the final close of its second European direct lending fundraising.
This fundraising has brought recent commitments to EUR4.3 billion across funds and separately managed accounts. The firm’s committed capital for the strategy now exceeds EUR5.7 billion.
The fundraising is part of the broader direct lending strategy that Alcentra has been offering to institutional investors since 2003. To date, Alcentra has invested over EUR5.3 billion in middle market companies across senior debt, unitranche, second-lien, mezzanine and equity investments.
Alcentra has been sourcing and arranging financings to middle market businesses in Europe since 2003. Alcentra was one of the first investment managers selected to participate in the HM Treasury Business Finance Partnership initiative in 2012. The closure of the second EDL fundraising follows that of Alcentra’s first EDL Fund in November 2014, whose committed capital for the strategy exceeded EUR1.5 billion.
Graeme Delaney-Smith (pictured), managing director and head of European direct lending for Alcentra, says: “It is an exciting time for direct lending. In recent years we have seen a growing interest from European companies and financial sponsors to partner with non-bank asset managers to access financing solutions. We believe that Europe represents one of the best opportunities in this space. Banks have had to increasingly focus on improving their capital ratios and as a result have been unable to lend to businesses to the extent they used to. This has created the opportunity for investment managers with credit and structuring expertise like Alcentra to provide financing to quality businesses. Our direct lending platform has gone from strength to strength and our fund, with such significant capital committed by investors, is the latest proof.”
Jack Yang, global head of business development at Alcentra, says: “Globally, institutional investors are looking for meaningful, long-term returns. Private lending is becoming a key strategy for them, given the potential for equity-like returns and the income and capital preservation of debt. I am very pleased with the strong interest that this Fund has generated amongst investors. The level of participation from pension funds, insurers, and not for profit organisations, is indicative of the growing popularity of this asset class and is strong recognition of Alcentra’s leadership.”
