LGT closes second debt fund at €1.35bn

The firm beat its original €800m target and attracted a significant number of new investors to the fund.

LGT European Capital has closed its Crown European Private Debt II fund at €1.35 billion.

The fund is the first vehicle raised since European Capital was acquired by Swiss asset manager LGT Capital Partners in the summer of 2017. The firm has also changed its name to LGT Private Debt, effective from 1 July.

Crown European Private Debt Fund II was launched in December 2017 with a target of €800 million and is significantly larger than its predecessor, which closed on €474.5 million in April 2016 with the backing of 17 institutional investors. In August last year, PDI revealed the fund had already garnered €640 million from 37 investors, according to an Securities and Exchange Commission filing.

LGT said it has received investments from more than 60 institutions including pension funds, insurance companies, endowments and family offices. The investors come from a wide geographic area including Europe, North America, the Middle East and Asia.

Juan Carlos Morales Cortes, partner at LGT Private Debt, said: “Institutional investors have shown an increasing interest in private debt investing over the last few years, especially in senior-secured, first-lien ranking unitranche. Thus, CEPD II has been supported by a combination of new and existing investors, who got access to a well-diversified pan-European portfolio in the attractive lower-mid market.”

The fund will provide unitranche and subordinated debt to companies across Europe with a target investment of between €15 million and €150 million.

LGT Private Debt said it will use its network of established relationships with private equity sponsors and intermediaries to give it sufficient quantity and quality of dealflow to make selective investment decisions.