New fund offers investors access to emerging asset class, lending to small and mid-sized companies in the UK, including the North West
British Business Bank Investments Limited, the commercial arm of the government-owned British Business Bank, has invested £30 million as part of its Investment Programme.
Muzinich & Co, an institutional asset manager specialising in corporate credit announced the first closing of its UK Private Debt Fund. The fund, which is a closed-ended vehicle with a 10-year investment term, has commitments from six institutional investors, including four major UK pension funds.
The first fund is targeting £350 million in assets and will lend to UK companies with an EBITDA of between £3 million and £20 million at the time of investment.
Muzinich & Co expanded into the North West of England in October 2015 with the opening of a Manchester office – its eighth office globally – whose primary purpose is to offer growth capital to mid-sized companies located in the UK’s industrial heartland outside London and the South East.
Commercial Secretary at the Treasury, Lord O’Neill, said:
“This new fund is further evidence of the momentum behind the Northern Powerhouse which is increasingly on the radar for investors from around the world.
“Alternative sources of finance like this fund are crucial to help northern businesses expand and create new jobs, which is at the heart of our plans to rebalance the economy.”
Peter Wilson, CEO of British Business Bank Investments Limited, added:
“We made an early commitment to support the development of the fund and are delighted that Muzinich has achieved such a successful first close. Its investment in a team at the heart of the Northern Powerhouse not only fits with our aim of developing new and diverse sources of debt finance for UK small and medium-sized companies but also gives Muzinich an edge in securing attractive lending opportunities beyond the South East.”.
The fund will be run by co-heads Kirsten Bode and Marc Shirman. Bode is based in London and Shirman in Manchester.
“More than 50% of private debt lending opportunities come from outside the South East. The opening of the Manchester office demonstrates our commitment to creating a fund that genuinely targets the whole of the UK,” said Muzinich Managing Director Josh Hughes..
Cllr Kieran Quinn, Chair of the Greater Manchester Pension Fund, one of the launch investors, said:
“Pension funds have traditionally acquired exposure to fixed interest through traded corporate bond funds. In the current market, private debt funds such as this offer attractive target returns, and the closed-ended structure reduces market risk. But of course, in private debt, strong bottom-up credit analysis is essential, and this is an area in which we expect Muzinich to deliver.”.
Muzinich Chief Executive and Chairman George Muzinich said:
“This is part of a longer-term commitment to providing growth financing to middle-market companies in Europe. Muzinich has already launched private debt funds in Italy, Spain and France. “.
For further information:
Muzinich & Co
Josh Hughes, Muzinich
Martin Stott, Bulletin
0845 075 0086
British Business Bank Investments Limited
Michael Lynch, British Business Bank
Nick Taylor, Seven Hills
020 7199 6185
NOTES TO EDITORS
Muzinich & Co was founded as a privately owned company in New York in 1988. It currently manages $24 billion across a variety of strategies in corporate credit. In addition to Manchester and London, the firm has offices in New York, Paris, Cologne, Madrid, Milan, and Zurich.
British Business Bank Investments Ltd is a wholly owned subsidiary of British Business Bank plc, the UK government’s economic development bank. It aims to earn a commercial return by investing through providers of finance to smaller businesses and small mid-caps, pursuing investments on a fully commercial basis without receiving any advantage from the government.
It is not authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). British Business Bank plc and its subsidiary entities are not banking institutions and do not operate as such. A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank plc website.BACK
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