The BNP Paribas European SME Debt Fund III (the “Fund III”) has reached its final close with a total of €741m ($821m), surpassing its initial target of €600m.
Small and medium-sized enterprises (or “SMEs”) and mid-cap firms in Continental Europe are provided with secured bullet loans by the SME Debt Fund III fund.
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With more than €1.7bn invested, BNPP AM’s private debt activity has aided in the expansion of more than 250 businesses since its founding in 2016.
About 20 institutional investors from six different nations, including asset managers, insurers, pension funds, and intergovernmental organisations, have shown trust in this third vintage. With this milestone, BNP Paribas Asset Management’s standing in the competitive corporate private credit market is strengthened.
Investors can diversify their asset allocation in this rapidly expanding market, which also offers an appealing risk-return profile. It also gives prosperous businesses another chance to finance their continued expansion.
Fund III has backed over 40 firms so far and aims to acquire a portfolio of 70 mid-caps and SMEs that are experts in their respective industries.
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By GlobalDataMoreover, Fund III, like the previous two vintages, has an unique posture in the private debt universe due to its extremely high granularity coupled with an extensive range of financing opportunities.
This is made feasible by the fund’s management team’s long-standing cooperation with BNP Paribas’ banking networks, which play an essential but not exclusive role in identifying financed companies.
Christophe Carrasco, head of private debt at BNPP AM, stated: “Senior European private credit offers a compelling option for SMEs and mid-caps, as one of the key elements for a company to strengthen its leading position, or to bolster global innovation efforts. As far as investors are concerned, private credit offers an attractive risk-return profile with a significant illiquidity premium over the bond market with counterparties that have dominant positions in their specialised sectors.”
David Bouchoucha, head of private assets at BNPP AM, added: “The success of this third senior debt vintage demonstrates the relevance of the model implemented by our private asset platform. The combination of unique market access thanks to the BNP Paribas Group, with the selectivity of experienced management teams, and a rigorous attention to ESG criteria, makes it possible to offer investors a differentiating product in this growing market.”
Fund III is administered by BNPP AM’s Private Assets division, which was established in January 2023. It has over 100 investment specialists and now manages and advises €40m in assets.
