Trea raises €70m for Spanish sponsorless deals

Barcelona-based fund manager Trea Direct Lending has posted a final close on its debut Direct Lending I fund on its target amount of €70 million.

The fund has attracted a range of institutional investors including unnamed pension funds and family offices as well as FOND-ICO, the €1.5 billion Spanish government-backed fund of funds.

The fund – which is 40 percent invested so far – finances Spanish SMEs, mainly with senior and senior convertible debt over a period of four to seven years. Tickets range from €5 million to €15 million per deal and target IRRs are in the range of 8-12 percent.

Only a handful of mid-market direct lending funds currently exist in Spain, but they believe a large opportunity has arisen as a result of new banking regulations and bank deleveraging, which has led the banks to become less active in some corporate credit activities. The Spanish economy has traditionally been very bank-reliant.

The Trea Direct Lending team includes founding and managing partner Ignacio Diez, who was previously with Brazilian direct lending firm Capitania as well as a number of European banks; and founding partner Carlos Tusquets, who founded Spanish private bank Fibanc in 1983.

Trea Direct Lending is part of Trea Asset Management, a traditional and alternative asset manager based in Spain with €4.2 billion of assets under management as at February 2017.

The firm has indicated that it is planning to start raising its second fund in the third quarter of this year.