Hayfin back on the road with two funds – exclusive

The private debt manager, which recently underwent a restructuring at ownership level, is back in the market with two successor funds – a new direct lending vehicle and its second special situations fund.

Hayfin is marketing for its second direct lending fund with a target of around €2.25 billion, PDI can reveal. The firm is discussing the size of the new vehicle with existing and new investors but legal documents are out, sources said.

The overall figure sought could be considerably higher when including hard-cap and separately managed accounts, said one of the sources. 

Hayfin, which reorganised its ownership structure in May, is seeking roughly €1 billion for its second special situations fund, the sources added. The firm is also looking into separately managed accounts for this strategy, PDI understands.

Hayfin declined to comment on the new funds.

London-based Hayfin, with €6 billion in assets, completed a complex restructuring at ownership level in May this year. Since then Hayfin has brought on more people, a market source said. Paul Moravek joined as managing director for UK origination in a newly created role in July, as reported.

One of the firm’s previous managing directors Jeff Sockwell left in June but remains an advisor to the firm, as reported. Managing director Paul Levy also departed.

Senior management at the firm includes Andrew McCullagh, head of origination, Tim Flynn, chief executive and Mark Tognolini, chief operating officer.

Hayfin’s private equity owners initiated a sale of the lender in late 2014. The process was subsequently dropped after being deemed overly-complicated. 

The resultant reorganisation saw one of the firm’s stakeholders, the Australian sovereign wealth fund The Future Fund, buy a portfolio of assets from the firm worth €705 million, freeing capital to be returned to all stakeholders including TowerBrook Capital Partners, Public Sector Pension Investment Board (PSP Investments) and Ontario Municipal Employees Retirement System (OMERS). Hayfin’s management increased their stake in the business and the equity stakes of all other owners were diluted as part of the recapitalisation.

Hayfin is one of several established direct lenders in Europe to launch fundraisings in the last 12 months. Intermediate Capital Group closed on its successor direct lending fund in September, after launching late last year. Ares Management also recently held a first close on its second fund dedicated to the strategy. Others raising their second direct lending vehicle include Alcentra and BlueBay Asset Management which is expected to close its second direct lending fund before the end of the year. 

Hayfin raised €2.28 billion for its first fund focused on senior secured loans to European mid-market companies in March 2014, surpassing its hard-cap of €1.5 billion. The firm raised a further €1 billion through separately managed accounts, as reported.

The lender’s first fund Special Opportunities Credit Fund raised total commitments of roughly €1.4 billion in 2013. The special situation investment strategy was set up to buy senior debt of small and medium-sized European companies and extend loans to companies affected by a reduction in bank lending.

Hayfin operates in mid-market and specialty lending, maritime, healthcare, syndicated debt and alternative credit such as asset backed securities.