Tikehau launches agri-focused debt fund

The French asset management firm has joined with Sofiprotéol to target investments in the agricultural industry. The fund is expected to raise €200m in capital and typical deal sizes will range between €5m and €10m as the firm targets an IRR of 4.5%.

Tikehau Investment Managers (Tikehau IM) and Sofiprotéol, a subsidiary of Groupe Avril, established to provide support to the French agricultural industry, have jointly launched a fund targeting debt investments in the sector.

A first close on the fund was announced yesterday, 7 July, after €100 million was committed to the vehicle from a number of institutional investors as well Tikehau IM and Sofiprotéol. The firm is targeting €200 million on final close. Although a representative from Tikehau IM said it has no deadline, it is expected to raise the money by the end of this year.

The mandate of the vehicle, titled Sofiprotéol Dette Privée, is to provide finance capital for French agricultural companies to support growth and development across the sector through either bullet loans or leveraged acquisition financing. Tikehau IM is tasked with managing the fund, while Sofiprotéol will provide industry expertise in sourcing deals.

Targeted ticket sizes range between €5 million and €10 million and the structure of the loans will cover stretched senior, unitranche and mezzanine as well as participating in leveraged loan syndication. The fund has a net return target of 4.5 percent. The fund is not working with placement agents or financial advisors.

Mathieu Chabran, chief executive of Tikehau, said: “This partnership is in line with our aim to participate in funding the real economy alongside a recognised industry leader.”

Michel Boucly, deputy chief executive of Sofiprotéol, said: “The experience, flexibility and reactivity of Tikehau IM’s private debt team are decisive factors in the success of the Sofiprotéol Dette Privée fund and a recognised tool for financing the agro-food sector.”

Tikehau Capital, the parent company of Tikehau IM, has €8.6 billion of assets under management across both its equity and debt departments. It employs more than 170 people across its offices located in Paris, Brussels, London, Milan and Singapore.

Sofiprotéol was established in 1983 to provide long-term support to the agricultural sector providing both equity and debt solutions. It is a subsidiary of Avril Group, an initiative set up by French farmers over 30 years ago and is today a financial group that generated €6 billion in revenue last year. It owns a number of high profile French brands including Diester, Sanders and Lesieur.