Muzinich & Co holds first close of European Senior Secured Private Debt Fund

Muzinich & Co has held the first close of the Muzinich European Senior Secured Private Debt Fund at EUR104 million.

The Fund focuses on providing growth financing solutions for European middle-market companies and explicitly incorporates environmental, social and governance (ESG) considerations and monitoring into the investment process.

With a target net return of Euribor plus 4 per cent, the Fund will predominantly invest in euro-denominated senior-secured 1st lien debt issued by European small and medium-sized enterprises (SMEs) (excluding the UK).

“Senior-secured debt instruments offer investors a lower-risk approach to private debt investing,” says Sandrine Richard, Co-Head of Senior Secured, Europe. “These instruments tend to have statistically higher recovery rates, possess superior documents and provide strong covenant protection.”

“Muzinich has been a signatory to the PRI since 2010 and is applying experience gained from integrating ESG considerations into the public debt investment process to our latest private debt strategy,” adds Archie Beeching, Director of Responsible Investment. “We believe that systematic inclusion of ESG into the due diligence process, investment committee meetings and portfolio company engagements will make a positive contribution to this Fund.”

Muzinich has been providing flexible financing solutions to SMEs since 2014. The firm currently manages a suite of eight private debt vehicles in the lower middle market with 54 investments to date and USD1.8 billion in gross committed capital.

Muzinich has a team of 29 dedicated private debt investment professionals located across 8 regional markets in Europe and the US. Team members work directly within their local markets to deliver on-the-ground deal sourcing and origination.