DWS secures €350m for co-investment debt fund

The fund will give institutional investors access to Deutsche Bank-originated senior loans.

DWS Group has raised more than €350 million for its closed-ended European Direct Lending Fund at first close.

The fund will exclusively make co-investments alongside Deutsche Bank’s European Direct Lending business in senior, European mid-market loans. The direct lending business is part of Deutsche’s global financing and credit trading unit and has invested in more than €5 billion across senior and opportunistic credit since 2012. DWS is an asset management division of Deutsche Bank.

The fund raised its capital from family offices, insurance companies and pension funds based in Europe and Asia. It is expecting to hold a final close before the end of the year on between €500 million and €700 million.

DWS said the fund will give investors unique access to Deutsche Bank’s pan-European network and client relationships. Typical loan sizes will be from €15 million up to €50 million and will target businesses with EBITDA of between €10 million and €50 million.

The fund has a seven-year lifespan with up to three one-year extensions and will invest for the first three years. It is approximately one-third invested.

Marcus Herbig, head of structured income at DWS, said: ““We set out to provide investors with a highly differentiated offering which has been validated by the breadth and calibre of investors, including first-time Direct Lending investors that have chosen to invest with us in the strategy.”

The fund offers several different share classes and currency options and aims to provide a return of around 6 percent in euros.