Candriam and Kartesia, a European specialist investment manager focused on private capital solutions, have launched a joint Luxembourg European Long-Term Investment Fund (ELTIF).
A statement today (10 February) said the fund will target private debt opportunities across the European lower mid-market (LMM) landscape, supporting local European economies and providing investment access for private and retail investors.
It is expected to become available in Austria, Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Portugal, Spain and Sweden, following the completion of the necessary filing.
The fund will offer exposure to the European LMM, where there is a deep pool of companies with limited financing options compared to larger markets, with a highly diversified loan portfolio across sectors and geographies and integrating a sustainable approach.
This allows more careful selection of deals, seeks to enhance downside protection, and aims to achieve better risk-adjusted returns.
The strategy combines the expertise of Kartesia and Candriam, two companies that are part of New York Life Investment Management (NYLIM), in private and liquid credit management.
It will benefit from Candriam’s established fund management capabilities and distribution network combined with Kartesia’s proven specialism in the LMM space and local approach and a combined dedicated team of investment professionals with over 25 years of experience.
The fund comprises two buckets: a liquid short term corporate credit and money market bucket representing 15% of the fund and managed by Candriam, and an illiquid component of 85% private credit complementary strategies focused on cash-flow generative businesses with growth potential, as well as seeking robust risk-adjusted returns and downside protection managed by Kartesia.
As such, it provides a flexible solution with a semi-liquid product offering, low entry ticket, and streamlined investment. It also benefits from the potential diversification effects offered by private credit loans, offering a relatively low volatility and low correlation to traditional asset classes, the statement said.
Renato Guerriero (pictured immediately below), deputy CEO, chief sales & distribution officer at Candriam, said: "Retail investors have struggled to access private markets, but ELTIF 2.0 changes that.
In the current interest rate environment, with banks lending less money, there is a clear opportunity in the lower mid-market private debt in Europe.
"We're excited to offer an appealing solution through this new ELTIF. Candriam and Kartesia bring over two decades of private and liquid credit management expertise, with a focus on sustainable investing."
Charles-Henri Clappier (pictured below), partner, head of KSO France & business development at Kartesia, added: “The launch of ELTIFS dedicated to private debt is crucial to the aim of increasing access for a broader range of investors to this established yet growing asset class.
"We are looking forward to bringing our considerable experience in the European lower mid-market to bear which, when combined with the distribution and fund management capabilities of Candriam, will enable the successful delivery of this product to private investors.
"We are looking forward to strengthening our partnership with Candriam, under the New York Life umbrella, as we continue to support Europe’s leading SMEs in their growth and development plans.”
