Levine Leichtman Capital Partners Closes Second Europe Fund with €463 million of Capital Commitments

Levine Leichtman

LOS ANGELES, October 13, 2020 – Levine Leichtman Capital Partners (“LLCP”) today announced the final closing of Levine Leichtman Capital Partners Europe II SCSp (“Europe II”) with €463 million of capital commitments.

Europe II received strong support from a prestigious group of institutional investors, including pension funds, insurance companies, banks, family offices and foundations.  Europe II has already completed one investment and has two additional investments under contract.

LLCP has been investing in Europe since the opening of its London office in 2011, expanding its presence with the addition of offices in The Hague in 2015 and Stockholm in 2019.  LLCP’s first Europe-focused fund, Levine Leichtman Capital Partners Europe, L.P., closed in 2015 with €100 million of capital commitments and has made four investments.

“We are excited to close our second Europe fund with commitments from returning and new limited partners,” said Michael Weinberg, a Managing Partner of LLCP.  “The very positive response to the fund is a testament to the success of our first Europe Fund and the differentiated investment strategy we implement on a global basis.  It also reflects the strength of our European team, which is supported by the broad resources and expertise of our entire firm.”

John O’Neill, Head of European Fund Investments at LLCP said, “Our firm is very enthusiastic about the investment environment across Europe. Over the past several years we have established offices in key European markets and recruited outstanding investment professionals, positioning our firm to capitalize on a range of attractive opportunities.” Wouter Snoeijers, a Managing Director of LLCP, added, “In the coming years we expect to continue building our European origination and investment operations, reflecting our commitment to supporting industry leading middle-market companies in this important market.”

About Levine Leichtman Capital Partners                                   

Levine Leichtman Capital Partners, LLC is a middle-market private equity firm with a 37-year track record of investing across various targeted sectors, including franchising, professional services, healthcare, education and engineered products.  LLCP utilizes a differentiated Structured Private Equity investment strategy, combining debt and equity capital investments in portfolio companies.  This unique structure provides a less dilutive solution for management teams and entrepreneurs, while delivering growth and income with a significantly lower risk profile.

LLCP’s global team of dedicated investment professionals is led by seven partners who have worked together for an average of 21 years. Since inception, LLCP has managed approximately $11 billion of institutional capital across 14 investment funds and has invested in over 85 portfolio companies. LLCP currently manages approximately $7 billion of assets – including its most recent flagship fund, Levine Leichtman Capital Partners VI, L.P., which closed in 2018 with $2.5 billion of committed capital – and has offices in Los Angeles, New York, Chicago, Charlotte, Miami, London, Stockholm and The Hague.

© 2020 Levine Leichtman Capital Partners. All rights reserved.

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CVC Credit Partners prices second CLO in a month

Apidos XXXIV will increase CVC Credit Partners Global CLO issuance in 2020 to over $1.6 billion

CVC Credit Partners is pleased to announce that it has priced Apidos XXXIV, a collateralised loan obligation fund totalling $402.5 million. This is the second CLO fund CVC Credit has priced in the last month, following the pricing of Cordatus XVIII in late September. Together these funds total c.$850 million of new issuance and will increase CVC Credit’s global CLO funds raised in 2020 to c.$1.6 billion. Pro forma for both funds CVC Credit’s global CLO assets under management now stand at approximately $17 billion.

Arranged by Deutsche Bank, Apidos XXXIV is CVC Credit’s second new-issue CLO to price in the US in 2020 and will increase US CLO AUM to approximately $10 billion. As with previous Apidos CLOs, the fund is primarily comprised of broadly syndicated First Lien Senior Secured Loans.

Cordatus XVIII is a €382.5 million European focused CLO, also arranged by Deutsche Bank. It is CVC Credit’s second European CLO priced in 2020, following Cordatus XVII in June. European CLO AUM now stands at $7 billion.

Kevin O’Meara, Senior Managing Director and Portfolio Manager at CVC Credit Partners, said: “To price two deals in the US during such a volatile year displays the disciplined and targeted approach of the platform. We are pleased with our asset ramp for Apidos XXXIV and the recent improving market conditions created a window to price our liabilities at an attractive financing rate.”

Gretchen Bergstresser, Global Head of Performing Credit at CVC Credit Partners, commented: “This is our fourth new CLO issuance globally in 2020 – a good result, particularly for a year as challenging as 2020. Thanks to the cohesion of our US and European teams we were able to run broadly concurrent processes for Apidos XXXIV and Cordatus XVIII, enabling various operational synergies to boost the speed and efficiency of both pricings.”

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Seaya Ventures launches its third fund with an initial closing of €85 million, reaching €250 million in assets under management

Seayaventures

  • c.90% of the commitments of the first closing come from investors in Seaya’s
    predecessor vehicles
  • Seaya’s first two funds rank among the top-quartile of their respective vintages
  • Seaya was the first financial investor in Glovo and Cabify, Spain’s first unicorns,  and continues to be the largest financial shareholder in both companies
  • Seaya III has already made its first investment in a European technology company that uses computer vision and artificial intelligence

Madrid, 5 October 2020. Seaya Ventures, Spain’s leading Venture Capital firm, has announced today that its third fund, Seaya Ventures III, has reached a first close of €85 million. With a target size of €125 million, the fund will remain open to new investors for the next few months.

Seaya Ventures III comes to the market only two years after the final closing of the previous fund. Seaya’s first two funds delivered above-market returns, ranking among the top-quartile of their respective vintages.

We are honoured to have our investment thesis validated with nearly 90% of the commitments of the first closing coming from existing Limited Partners (LPs) of our predecessor vehicles,” said Beatriz González, founding partner of Seaya Ventures.

The new fund will follow Seaya’s strategy of investing in outstanding and mission-driven founders. Seaya aims to invest mainly in top Southern Europe tech companies, partnering with companies and contributing to their international expansion. By leveraging its local knowledge with a global ecosystem, Seaya can help companies scale and become regional and global leaders.

Seaya is known for taking significant stakes in companies, becoming the reference investor for founders and providing them with sustained hands-on support. The fund will continue to focus on leading Series A and B rounds, being able to invest up to €20 million per company throughout several rounds. Seaya partners exclusively with companies that target long-term, sustainable growth, which hold themselves to the highest professional and ethical standards.

Seaya views the current Covid crisis as a catalyst for exponential growth in technological innovation as demonstrated by the digital transformation that has taken place in just a few months and that in regular circumstances would have taken years. This strong digital transformation is being reflected in the types of deeptech companies that Seaya III is currently considering for potential investment, which are in sectors ripe for disruption such as healthtech, edtech and fintech.

Seaya’s goal is to partner with the best founders and support them to make their global vision become a reality. Founders that are mission-driven and look for long-term sustainable growth have proven that they are more resilient and have a larger positive impact on society”, said Beatriz González, founding partner of Seaya Ventures.

Through Seaya’s high-conviction investment strategy we become a major shareholder in our companies and we build a strong relationship with the founders, supporting them during their exponential growth, not only by providing capital but also with our know-how and global network”, explained Antonio Giménez de Córdoba, partner of Seaya Ventures.

Since 2013, Seaya has invested in 26 disruptive tech companies that have become leaders in their respective industries, including Cabify and Glovo, Spain’s first two unicorns. Seaya led the first institutional rounds in both companies and remains their largest financial shareholder. Other investments include Savana, a medical technology company accelerating health science by unlocking the clinical value embedded within the Electronic Health Records; Wallbox, a leading designer, manufacturer and distributor of the most advanced smart charging solutions for electric vehicles; and Buguroo, a cybersecurity company that uses data analytics to help digital businesses protect themselves from online and mobile fraud.

Seaya’s aggregate portfolio is currently worth more than €3 billion, after having attracted over €1.2 billion in funding from Europe, USA and Asia, as well as having created 4,500 direct and 240,000 indirect jobs. At present, including the new funds raised, Seaya has €250 million of assets under management.

Seaya III has already completed its first transaction, leading a Series A investment in a European technology company that uses computer vision and artificial intelligence. The new investment will be officially announced in the next few weeks.

About Seaya Ventures

Based in Madrid, Seaya Ventures has been backing the best entrepreneurs and teams in Southern Europe since 2013. Seaya focuses on supporting founders in scaling their businesses, enabling them to become global leaders. For more information visit www.seayaventures.com.

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Eurazeo strengthens its asset management activities with a new organisation meeting the needs of its investors

Eurazeo

Christophe Bavière promoted Senior Managing Partner of Eurazeo and Head of Investment Partners

Paris, 5 October 2020

Eurazeo is a leading global investment company with more than €18.5 billion in assets under management and provides investors with valuable access to investment strategies diversified across asset classes, industry sectors and geographies. Currently, 65% of these assets are directly invested in companies’ equity or real assets. Similarly, the Group’s activities in private debt and secondary transactions make it a European leader in these areas and have seen steady growth for several years.

Underscoring the appeal of its investment strategies to investors, Eurazeo reached new heights with its fundraising bringing in €2.4 billion in 2019. Following a robust first half of this year, with €1.2 billion raised in unfavourable and uncertain market conditions, Eurazeo expects to build on this momentum over the remainder of the year, driven in particular by the success of the Eurazeo Growth III fund. This performance is not only the result of the renewed commitment and confidence of the Group’s long-standing institutional investor partners, but is also driven by Eurazeo’s increasing ability to attract new international partners.

In line with this growth trajectory and in order to offer investors services of the highest standards, Eurazeo today announced that it is strengthening its function dedicated to institutional investors and wealth management structures by bringing together the veteran management teams of Eurazeo and Idinvest. The Group’s teams who focus on maintaining and developing these relationships, are staffed by some 30 investment professionals. They are divided by specialisation, for each geographic region and type of investor (sovereign wealth funds, pension funds, insurance companies, wealth managers, strategic industrial partners, etc.) and cover all market segments seeing rapid growth (venture capital, growth equity, private debt, asset-backed securities, secondary transactions, funds of funds, real assets, and small and mid-cap buyouts).

Under the leadership of Christophe Bavière, appointed as Senior Managing Partner of Eurazeo and Head of Investment Partners, these teams will work to consolidate the Group’s leading position among French investors, increase its market share among international investors, particularly in the United States, Europe, the Middle East and Asia, and further diversify its client portfolio: from retail investors to large sovereign wealth funds, insurance companies and international pension funds.

By strengthening its ability to offer its investors the best possible service, Eurazeo is intensifying the execution of its growth strategy across all its activities, building on its capacity to generate predictable and recurring revenue over the long term, consolidating its international business network to an even greater degree, and reaffirming its ambition to become the benchmark player among investment platforms in Europe.
Christophe Bavière, Senior Managing Partner of Eurazeo, said:
I am very happy with these responsibilities, which confirm the ambitions of our Group. We serve our clients with a range of funds as well as dedicated investment solutions. We also offer them targeted and diversified investment vehicles, which go hand in hand with a robust approach to managing ESG factors.

About Eurazeo
• Eurazeo is a leading global investment company, with a diversified portfolio of €18.5 billion in assets under management, including €12.9 billion from third parties, invested in over 430 companies. With its considerable private equity, real estate and private debt expertise, Eurazeo accompanies companies of all sizes, supporting their development through the commitment of its nearly 300 professionals and by offering in-depth sector expertise, a gateway to global markets, and a responsible and stable foothold for transformational growth. Its solid institutional and family shareholder base, robust financial structure free of structural debt, and flexible investment horizon enable Eurazeo to support its companies over the long term.

• Eurazeo has offices in Paris, New York, São Paulo, Seoul, Shanghai, London, Luxembourg, Frankfurt, Berlin and Madrid.

• Eurazeo is listed on Euronext Paris.
• ISIN: FR0000121121 – Bloomberg: RF FP – Reuters: EURA.PA
EURAZEO
EURAZEO

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Nordic Capital sprints to EUR 6.1 billion Fund X in less than six months in wholly remote capital raise

Nordic Capital

October 01 2020
Nordic Capital sprints to EUR 6.1 billion Fund X in less than six months in wholly remote capital raise Image

 

  • Tenth fund exceeds target of EUR 5 billion, closes at its hard cap with significant excess demand and is the largest fund raised in Nordic Capital’s history
  • Very strong demand from a diversified blue-chip global base of new and returning investors with all due diligence conducted remotely
  • Investors attracted to Nordic Capital’s leadership in its focus sectors, proven value-creation track record, high ESG ratings and resilient portfolio
  • Fund X set to continue successful strategy of focusing on majority investments in non-cyclical growth companies in the Healthcare, Technology & Payments and Financial Services sectors

Nordic Capital today announced the successful final close of Nordic Capital Fund X (“Fund X” or “the Fund”), at EUR 6.1 billion (including GP commitment of 6.5%). The Fund, launched in April 2020, was oversubscribed at its hard cap, and was raised in less than 6 months in a groundbreaking remote capital raise without holding any face-to-face meetings. This is the largest fund that Nordic Capital has raised since its inception in 1989 and surpasses its 2018-vintage Nordic Capital Fund IX which raised EUR 4.3 billion (including GP commitment).

Investors were attracted to Nordic Capital’s leadership, proprietary sourcing methods and proven track record of creating value through business transformation and solid earnings growth in its focus sectors of Healthcare, Technology & Payments, Financial Services and its selective investments in Industrial & Business Services. Nordic Capital’s strategy of focusing on non-cyclical, growth businesses was validated by the strong performance of the existing portfolio since the COVID-19 pandemic started. In addition, Nordic Capital recently received the highest ESG rating from the UNPRI.

Kristoffer Melinder, Managing Partner, Nordic Capital Advisors, said: “The rapid and successful close of our tenth fund is a significant milestone for Nordic Capital. To close at the hard cap in less than six months during the COVID-19 pandemic is a fantastic achievement that highlights the strength of our LP relationships and the considerable confidence that our blue-chip investors have in Nordic Capital. It is also testament to the strength of our team, proven investment strategy, the portfolio performance and Nordic Capital’s track record. We are grateful for the continued support of existing limited partners and delighted to welcome new investors to the Fund.”

Kristoffer Melinder added: “Nordic Capital’s investment strategy is based on finding growth businesses in our focus sectors where we can use our significant operational expertise and financial firepower to create value and, ultimately, excellent returns for our investors. The economic impact of the COVID-19 pandemic will continue to be felt for some time and the most successful fund managers will be those who respond well to emerging trends and market dynamics to leverage new opportunities. Fund X has a strong pipeline of attractive investment opportunities in our chosen sectors across Europe, and globally for Healthcare. The Fund has already signed its first investment in Siteimprove – a leading software company that supports digital accessibility for people with disabilities.”

Fund X attracted investors from across the globe, with investors from every continent including 38% from North America, 27% Europe, 17% from Asia, 15% from the Middle East and 3% from RoW. The investor base comprises a well-diversified mix of institutional investors: public and private pension funds (c. 49%); sovereign wealth funds (c. 16%); fund of funds (c. 13%); financial institutions (11%); and endowments and family offices (c. 10%). The new Fund expands Nordic Capital’s blue-chip investor base with 34% of commitments deriving from new investors. The re-up rate by capital of Fund IX LPs in Fund X is c. 90%. The Fund also drew significant support from Nordic Capital’s own team, as well as portfolio company management teams and industrial advisors.

Pär Norberg, Head of Investor Relations, Nordic Capital Advisors, said: “We are very grateful for the tremendous investor support. We launched this fund in the middle of a global pandemic, which required investors to completely alter their investment processes to enable remote diligence. The success of the fund raise despite these challenges reflects the investors’ considerable confidence in Nordic Capital’s strategy and team.”

Fund X will be invested across Europe, with a mandate for global investment in Healthcare as in the prior Fund and an emerging smaller global mandate also for Technology & Payments businesses.

Nordic Capital’s proprietary sourcing methods have continued to generate a strong deal pipeline despite the pandemic. It has in 2020, announced two new platform acquisitions: Max Matthiessen in May, a leading financial advisor in the Nordic region and Siteimprove in September, a global leader within website experience and digital marketing optimisation. Furthermore, it has supported several transformative portfolio company add-ons and completed two partial exits. Nordic Capital’s current portfolio companies have on average achieved 10% organic employment growth and an 8% increase in annual sales.

The fundraising was led by Nordic Capital’s in-house Investor Relations team, supported by Rede Partners who acted as global placement agent, Transpacific in Asia, Ameris in South America, with Kirkland & Ellis as lead legal counsel, supported by Carey Olsen in Jersey and Arendt in Luxembourg.

Footnote: “Nordic Capital” refers to any, or all, Nordic Capital branded or associated investment vehicles and their associated management entities. Nordic Capital is advised by several non-discretionary sub-advisory entities, any or all of which is referred to as “Nordic Capital Advisors”.


Media contacts:

Katarina Janerud, Communications Manager
Nordic Capital Advisors
Tel: +46 8 440 50 50
e-mail: katarina.janerud@nordiccapital.com

About Nordic Capital

Nordic Capital is a leading private equity investor with a resolute commitment to creating stronger, sustainable businesses through operational improvement and transformative growth. Nordic Capital focuses on selected regions and sectors where it has deep experience and a long history. Focus sectors are Healthcare, Technology & Payments, Financial Services and in addition, Industrials & Business Services. Key regions are Europe and globally for Healthcare. Since inception in 1989, Nordic Capital has invested more than EUR 15 billion in over 110 investments. The Nordic Capital vehicles are based in Jersey and Luxembourg. They are advised by several non-discretionary sub-advisory entities based in Sweden, Denmark, Finland, Norway, Germany, the UK and the US, any or all of which are referred to as Nordic Capital Advisors. For further information about Nordic Capital, please visit www.nordiccapital.com

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Antares Capital Announces Final Close of Inaugural Senior Loan Fund

Antares

CHICAGO–(BUSINESS WIRE)–Antares Capital Advisers LLC, a subsidiary of Antares Capital LP (together with its parent companies, “Antares”) announced the final closing of its inaugural Senior Loan Fund (“SLF”).

“The closing of our inaugural fund is a significant milestone in continuing to diversify our investor base, and the ability to do so during the current market environment is a clear testament to the strength of the Antares brand”

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The fund, which launched in December 2019, closed on September 14th with approximately $3 billion of asset purchasing power, exceeding its initial target of $1.5 billion. Capital was raised across a diversified set of institutional investors.

The investment objective of the SLF is to build a diverse portfolio of sponsor-backed senior secured loans to U.S. and Canadian borrowers. Investors in the fund are primarily public and private pensions, insurance companies, asset managers and banks located predominantly in the U.S., Canada, Asia and the Middle East.

“The closing of our inaugural fund is a significant milestone in continuing to diversify our investor base, and the ability to do so during the current market environment is a clear testament to the strength of the Antares brand,” said Vivek Mathew, senior managing director and head of asset management. “Investors appreciate that Antares’ market position allows us to be highly selective in the opportunities in which we invest. Also, Antares has implemented a variety of measures to demonstrate alignment of interests with our investors, and ultimately when markets turn, we have a track record of strong performance through market cycles.”

“COVID-19 has been a stress test for our asset class, and while the story is not fully written yet, it appears that middle market private debt will perform well,” said David Brackett, CEO of Antares. “As a result, we anticipate further growth in our asset management platform. As a firm we recently recognized the five-year anniversary of our partnership with CPPIB Credit Investments Inc. During this time we are proud to have continued to build upon our industry-leading platform targeting private equity-owned middle market companies.”

Antares Capital Advisers LLC is the registered investment adviser arm of Antares. Antares has leveraged its credit expertise and investor relationships through Antares Capital Advisers LLC to build a platform that complements its broader origination capabilities.

About Antares

With approximately $27 billion of capital under management and administration as of December 31, 2019, Antares is a private debt credit manager and leading provider of financing solutions for middle-market private equity-backed transactions. In 2019, Antares issued approximately $17 billion in financing commitments to borrowers through its robust suite of products including first lien revolvers, term loans and delayed draw term loans, 2nd lien term loans, unitranche facilities and equity investments. Antares’ world-class capital markets experts hold relationships with more than 400 banks and institutional investors allowing the firm to structure, distribute and trade syndicated loans on behalf of its customers. Since its founding in 1996, Antares has been recognized by industry organizations as a leading provider of middle market private debt. The company maintains offices in Atlanta, Chicago, Los Angeles, New York and Toronto. Visit Antares at www.antares.com or follow the company on LinkedIn at http://www.linkedin.com/company/antares-capital-lp. Antares Capital LP is a subsidiary of Antares Holdings LP.

Contacts

Antares Capital
Carol Ann Wharton
475-266-8053
carolann.wharton@antares.com

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CVC Credit Partners prices second European CLO of 2020

Cordatus XVIII will increase CVC Credit Partners European CLOs issuance in 2020 to more than €650 million

CVC Credit Partners (“CVC Credit”) is pleased to announce the pricing of Cordatus XVIII, a collateralised loan obligation (“CLO”) fund totalling €382.5 million arranged by Deutsche Bank. As with previous Cordatus CLOs, the fund is primarily comprised of broadly syndicated First Lien Senior Secured Loans.

This will be the second CLO fund CVC Credit has raised in Europe in 2020 following the closing of Cordatus XVII in June on €290 million. European CLO assets under management have now reached a new milestone at c.$7.0 billion.

Guillaume Tarneaud, Senior Managing Director and Portfolio Manager at CVC Credit Partners, said: “As with most of the broader economy, 2020 has been a challenging year for CLO markets, but we have knuckled down and thanks to strong investor demand we have been able price our second European CLO this year.”

Gretchen Bergstresser, Global Head of Performing Credit at CVC Credit Partners, said: “We are delighted to have priced our second European CLO this year and the third globally. This was again a great team effort across our CLO business, leveraging the joint expertise of both our London and New York offices to get this fund to market.”

Closing is expected in November 2020 and is subject to customary closing conditions.

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ICG establishes Milan Office

15 September 2020

Intermediate Capital Group (ICG) is pleased to announce that it has opened an office in Milan, headed by Luigi Bartone, Head of ICG Italy; he will be joined by Giulio Piccinini, Managing Director, previously based in London.

Luigi Bartone joined ICG in 2004 from AT Kearney and holds an MBA from INSEAD. ICG has invested regularly in the region ever since.

Giulio Piccinini joined ICG in 2017 from Vision Capital. Prior to his private equity investment career, Giulio worked in the investment banking division of Bank of America Merrill Lynch and as a management consultant at Bain & Co. Giulio holds an MBA from New York University.

Commenting on ICG’s move to establish an office in Milan, Luigi Bartone, Managing Director, Head of Italy, said, “Italy is a significant market for ICG and the opening of a permanent office strengthens our presence and commitment to the country. There is plenty of activity in Italy and with an office in Milan we will capture even more opportunities across asset classes; we will be closer to our portfolio companies, and to entrepreneurs and management teams willing to partner with ICG to accelerate their companies’ growth”.

For further information please contact:

ICG
Alicia Wyllie
Co-Head of Corporate Communications
Tel: +44 (0)203 201 7994
Mobile: +44 (0)7808 610080
Email: alicia.wyllie@icgam.com

Helen Gustard
Co-Head of Corporate Communications
Tel: +44 (0)203 201 7760
Mobile: +44 (0)7932 486928
Email: helen.gustard@icgam.com

Maitland/amo
Sam Turvey
Partner
Tel: +44 (0)207 379 5151
Mobile: +44 (0)78 2783 6246
Email: sturvey@maitland.co.uk

About ICG
ICG is a global alternative asset manager with over 30 years’ history.

We manage €45.6bn* of assets in private debt, credit and equity, principally in closed-end funds. We provide capital to help companies grow through private and public markets, developing long-term relationships with our business partners to deliver value for shareholders, clients and employees. We operate across four asset classes – corporate, capital market, real asset and secondary investments. In addition to growing existing strategies, we are committed to innovation and pioneering new strategies across these asset classes where the market opportunity exists.

ICG is listed on the London Stock Exchange (ticker symbol: ICP). Further details are available at: www.icgam.com . You can follow ICG on LinkedIn.

*as at 30 June 2020

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Tesi’s performance and results H1 2020: Ensuring financing for Finnish growth companies amid corona pandemic

Tesi

Impact24.9.2020

 

Highlights of the review period:  

  • Tesi made new investments and commitments amounting to 183 M€ during the first half of the year. These included:  
    • 65 M€ commitment to the KRR IV fund-of-funds  
    • a total of 45 M€ in commitments to venture capital and private equity funds  
    • direct investments amounting to 23 M€  
    • altogether 50 M€ in stabilisation investments
  • The KRR IV fund-of-funds managed by Tesi raised a total of 175 M€
  • Tesi’s Finnish portfolio funds raised new capital amounting to 333 M€
  • Tesi’s international partners invested altogether 49 M€ in Finnish companies.  

 

  

Tesi’s CEO Jan Sasse comments on the review period:  

“The COVID-19 pandemic produced a shock both in the global economy and in Finnish companies. The full effects of this shock will not become clear until well into the future. Tesi’s role in this special situation is to ensure through financing that there are still innovative, viable companies providing employment in Finland after the crisis has passed. Towards this end, we have collaborated extensively with growth companies, our state owner, the venture capital and private equity sector and other stakeholders by creating new financial instruments for growth companies as well as by producing status reports to aid decision-making.  

Growth companies financed by the VC/PE market play a crucial role in achieving transformative and sustainable economic growth. Tesi invests in companies’ growth and over the long term develops the VC/PE market. Just before the coronavirus crisis, together with Finnish pension and insurance companies, we established the new KRR IV fund-of-funds that invests in Finnish VC/PE funds.  

Before the COVID-19 struck, Finnish funds had raised large volumes of capital, specifically on the venture capital side. Consequently, the pandemic has not hampered fundraising to a large extentapart from some individual funds. In the spring, the prospects for follow-on financing for venture capital and private equity backed companies were also good. More traditional SMEs encountered  difficulties the most, as COVID-19 had a direct impact on their business operations. We launched a fast-track stabilisation program precisely for these companies that were facing an acute liquidity crisis. In the first half of the year, we invested 50 M€ from the stabilisation program in altogether nine companies. We will continue to offer stabilisation financing as the market situation demands. 

On the venture capital side, Finnish start-ups raised a record amount of capital in the first half of the year, despite the COVID-19 crisis. Time will tell whether the pandemic will impact the operations of international investors in the future. Tesi was involved in large venture capital rounds (SwappieVarjo Technologies, ICEYE), where we utilised the EFSI investment programme set up in collaboration with the EIB. For earlier-stage companies, we offer Venture Bridge financing that will give start-ups more time for raising larger financing rounds.  

Despite the challenging business environment, our net profit for the review period was €7 million. Tesi has solid resources for long-term investment operations that emphasise sustainable development and positive societal impacts. Capitalisation by the Finnish state has also given Tesi the resources to ensure the supply of financing for the duration of the crisis should the pandemic be prolonged.”

Business environment  

Before the COVID-19 pandemic struck, Finnish funds had raised large volumes of capital, especially on the venture capital side. As a result, the coronavirus pandemic has so far not widely impacted the fundraising of Finnish funds to a large extentIndividual funds have faced some difficulties in raising the target size on schedule due to the market uncertainty. 

Based on the market pulse survey conducted by Tesi, Finnish Venture Capital Association and Business Finland Venture Capital in May, Finnish investors are fairly well placed to provide follow-on financing for their portfolio companies. 

In the first half of 2020, Finnish startups raised a record amount of capital, 330 M, despite the coronavirus pandemic (SourceTalouselämä). Valuations of venture capital backed companies have remained broadly the same.  

The more conventional venture capital backed companies and business models (software, digitalisation) have been the winners of the COVID-19 situation. The business operations of these companies have mostly fared well. Securing financing is more challenging for companies that are raising Series A funding rounds yet lack a longer-term track record, and for more atypical business models, in which the presence of, for instance, industrial investors has become emphasized in recent years.  

The main concern now with regard to Finland’s GDP is the prospect of falling demand on the global market for the goods and services of more traditional SMEs and of Finland’s export sector. Also, established consumer-driven businesses have encountered serious challenges. 

Investments 

During the first half of the year, Tesi made new investments amounting to 183 M (76 M€ in H1 2019). These included a commitment to the KRR IV fund-of-funds, commitments to VC/PE funds, direct investments, and stabilisation financing.  

Tesi made commitments to funds totalling 45 M. Four of these commitments were to Finnish funds (Superhero Venture Fund 2020, Icebreaker Fund II, GOS Private Debt I, Verso III), and one was to an international fund to be announced later. New capital raised by Tesi’s Finnish portfolio funds totalled 333 M€. Tesi made a commitment of 65 M€ to the 175 M€ KRR IV fund-of-funds. Co-investors in KRR IV are the pension/insurance companies Ilmarinen, Keva, State Pension Fund of Finland, Elo, LähiTapiola and Veritas. The KRR fund-of-funds managed by Tesi invest in Finnish venture capital and growth funds.  

Tesi made direct investments amounting to 23 M€ in 14 companies. Three of these were initial investments totalling 11 M€ (Upcloud, Nordic Rescue Group, Swappie). Follow-on investments totalling 12 M€ were made in altogether 11 companies. 

In April, Tesi launched a 150 M€ stabilisation financing program for mid-sized companies in response to the COVID-19 pandemic. Stabilisation investments differ from Tesi’s normal investments and offer companies facing an acute liquidity crisis financing to overcome the situation. Tesi made nine investments amounting to 50 M€ under the stabilisation programme. These companies employ some 8,200 people in Finland.  

In mid-June 2020, Tesi launched Venture Bridge for companies that have previously raised at least seed financing from professional venture capital investors and have had to postpone their next external financing round due to COVID-19. No investments under the programme had yet been made in June. By 10 September 2020, Tesi has made investments decisions totalling 2.4 M€ in altogether five companies (BlidzDisior, Matchmade, Fake Production, Revonte). 

Financials

Profit after taxes for the review period was 7 M€ (13 M€ in H1 2019). The strong result of 36 M€ by funds can be explained by the good first half of the year, which saw several positive exits. Direct investments produced a net loss of 12 M€, which mainly resulted from the decrease of the fair value of the portfolio companies at more mature stages, and the weakening of their business environment due to the corona pandemic. The weakened market situation also reflected to financial securities as they produced a loss of 10 M€. 

The balance sheet total amounted to 1.288 B€. The largest change in shareholders’ equity, 1.245 B, was the state capitalisation of 150 M€ intended for Tesi’s new investment programs 

In preparation for any worsening of the economic situation, the Finnish state committed a further 250 M€ for capitalising Tesi in the 2020 supplementary budget IV. The additional capital will be channelled flexibly, according to the market situation, into venture capital investments, Tesi’s stabilisation program and investments in funds over the next two years to mitigate the disruption caused by the COVID-19. The appropriations from the supplementary budgets already paid, and those to be paid in the future, will be returned to the Finnish state after Tesi’s exits. 
  
Tesi’s investments under management at the end of the review period totalled 1.6 B€. In addition to Tesi’s own investments and commitments, the figure includes investments made by the KRR funds-of-funds and managed by Tesi as well as the European Investment Bank’s capital earmarked for the EFSI co-investment programme 

Events after review period and prospects for year end  

After the review period, Tesi gave a commitment to CapMan Growth Equity Fund II and made a direct investment in Varjo Technologies. Tesi also made Venture Bridge investments totalling 2.4 M€ in five companies.  

Despite the coronavirus pandemic, Finnish start-ups raised a record amount of capital during the first half of 2020. The impacts of the pandemic on international venture capitalists’ activity remains to be seen. The negotiations for many of the large financing rounds that took place in the summer and early autumn were already initiated before the pandemic struck. 

The second half of the year is likely to be challenging for more traditional SMEs. The challenges are, however, sector and company-specific. Shortened order books will have wide consequences for engineering companies. Furthermore, Finland having a post-cyclical economy, the full impacts will not be seen until later. 

Tesi’s deal flow is normalisingTesi is, however, well prepared for worsening conditions for growth companies by ensuring the fund-raising of VC/PE funds, expanding its role in direct venture capital investments, both in Venture Bridge and in larger financing rounds, and by offering stabilisation financing to mid-sized companies that were profitable pre-coronavirus.  

The key driver of Tesi’s operations is to make a positive social impact. The main methods for promoting positive social impacts are channelling capital to companies that will use their expertise and solutions to make a net impact on society that is as beneficial as possible and producing information on the impacts of operations.

Read in more detail:

Tesi’s performance and results H1 2020 


For further information, please contact:
 

Jan Sasse, CEO, Tesi
jan.sasse@tesi.fi, +358 40 861 9151 

  Tesi (Finnish Industry Investment Ltd) is a state-owned investment company that wants to raise Finland to the front ranks of renewing economic growth by investing in funds and directly in companies. We invest profitably and responsibly, hand-in-hand with co-investors, to create the world’s new success stories. Our investments under management total 1.6 billion euros. Ambition for ownership and success www.tesi.fi | www.dtg.tesi.fi | @TesiFII

 

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The Board of Directors of Ratos proposes a reinstated dividend

Ratos

On March 30, 2020, the Board of Directors of Ratos decided to withdraw the proposal for a dividend for fiscal year 2019, due to the market instability and uncertainty factors about COVID-19’s medium-term financial effects. In addition, it was stated that the Board of Directors had an intention to call the shareholders to an Extraordinary General Meeting later in the year to resolve on a dividend, if the market had stabilized at this time and the company’s visibility in earnings had normalized. The Board of Directors has now assessed the company’s financial performance and cash position and concluded that a reinstatement of the dividend is appropriate. Therefore, the Board of Directors has decided that the company shall call for an Extraordinary General Meeting on 22 October, 2020, to decide on a proposal of a dividend of SEK 0.65 per share to be paid for the fiscal year 2019. Ratos will repay the governmental grants that have been received in Sweden related to the COVID-19 situation. Further details regarding the Extraordinary General Meeting will be provided shortly in a separate notice for the meeting.

For further information, please contact:
Jonas Wiström, CEO Ratos, tel: +46 8 700 17 00
Helene Gustafsson, Head of IR- and Press Ratos, tel: +46 70 868 40 50, email: helene.gustafsson@ratos.se

This press release contains insider information that Ratos AB is required to disclose under the EU Market Abuse Regulation. The information was submitted for publication, through the contact person set out above, at 6:00 pm CET on 22 September, 2020.

About Ratos:
Ratos is a business group consisting of 12 companies divided into three business areas: Construction & Services, Consumer & Technology and Industry. In total, the companies have SEK 38 billion in sales and EBITA of SEK 1.8 billion. Our business concept is to develop mid-sized companies headquartered in the Nordics that are or can become market leaders. We enable independent mid-sized companies to excel by being part of something larger. People, leadership, culture and values are key focus areas for Ratos. Everything we do is based on Ratos’s core values: Simplicity, Speed in Execution and It’s All About People.

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