Pemberton closes second mid-market fund at €3.2 billion

The fund manager has significantly expanded its presence across Europe in anticipation of opportunities from banks deleveraging.

Pemberton has closed its second-generation European mid-market fund at €3.2 billion, breaking its €2.5 billion target.

The fund manager, which is 40 percent owned by insurer Legal & General, has also raised €1 billion for its first Strategic Credit Opportunities Fund.

Pemberton European Mid-Market Debt Fund II launched in 2018 as a follow-up to the firm’s first mid-market credit vehicle, which closed on €1.2 billion in 2016. It will target providing senior loans for acquisitions and growth capital and is targeting returns of between 7 percent and 8 percent.

Pemberton Strategic Credit Opportunities Fund I launched in 2017 and has now closed at its €1 billion target. The fund will target more complex credit opportunities and invest across the capital structure, including investments in stressed companies. It is targeting returns of between 10 percent and 12 percent. Both vehicles are approximately 70 percent deployed.

The fund manager said its latest fundraising drew a wide range of investors including pension funds, insurance companies, high-net-worth individuals and foundations. Historically, Pemberton has primarily raised funds in Europe with its previous fundraising consisting of 85 percent European investors. However, the most recent fundraising has seen around 40 percent of capital come from outside of Europe, predominantly from North America, followed by Asia.

Commenting on the fundraising, Pemberton managing partner Symon Drake-Brockman, said: “As banks continue to de-risk and de-lever, there are several trillion that will need to come off their balance sheets in the coming years. With one of the largest pan-European teams dedicated to direct lending opportunities, Pemberton is well-placed to connect capital and fill this funding demand that stems from borrowers across the region.”

Pemberton has made a number of hires and opened several new offices across Europe. Since the beginning of the year, it has opened offices in Amsterdam and Copenhagen and hired 10 people including several senior roles.