Exclusive: Pemberton preps first close north of €500m

The alternative lender backed by UK insurer Legal & General is targeting €1 billion-plus for its first direct lending fund.

Legal & General-backed lender Pemberton is preparing to hold a first close north of €500 million on its debut senior direct lending fund, industry sources said. The pan-European fund is targeting more than €1 billion and is expected to close early in the second quarter.

Pemberton Mid-Market European Debt Fund has attracted commitments from a number of limited partners including leading European insurance companies, PDI understands. The investment firm is eyeing a final close for the fund later this year. It is also in the process of establishing other funds, a source said.

Pemberton declined to comment.

London-headquartered insurer Legal & General, which has a 40 percent stake in Pemberton, made an initial commitment of €250 million to the new direct lending platform in July 2014.

The asset manager, led by managing partner Symon Drake-Brockman, is focused on providing senior and senior secured loans and private placements to mid-market corporates in the UK and Europe with turnover between €100 million and €1 billion, and on lending directly to non-sponsored corporates in particular. The asset manager has already completed several transactions ahead of the first close. Similar to other direct lending funds in the European market at present, it is targeting yields of around 6 to 7 percent.

The strategy is advised by Arbour Partners and Citigroup is acting as private placement agent, PDI understands.

Pemberton, with a team of 30, has offices in London, Amsterdam, Frankfurt, Milan and Madrid. A sixth is due to open in Paris shortly. Managing partner Drake-Brockman, former global head of debt markets at Royal Bank of Scotland (RBS), has been building up an origination team over the last six months.

Thomas Duetoft, formerly of RBS and Dresdner, was hired to head up origination at the firm. His appointment was announced in November in tandem with that of John Doyle, former head of Seimens Bank’s leveraged and acquisition finance team. Doyle is the firm’s head of UK and Ireland. Jürgen Breuer, who led leveraged finance franchises at both Dresdner and West LB, also joined as head of Germany, Austria and Switzerland in January this year.