The private debt fund, INVL Bridge Finance, of Invalda INVL, the leading asset management group in the Baltics, provided EUR 21.8 million funding to companies in the first half of this year, and increased the Fund’s assets to EUR 32.5 million by the end of June.
In January-June 2024, four companies received funding from the Fund and a total of eight contracts were signed. The Fund’s portfolio currently includes seven active investments in Lithuania, Latvia and Estonia. The portfolio of INVL Bridge Finance is dominated by alternative lending companies which use the Fund’s loans to grow their own portfolios. The Fund has also employed funds raised from investors in renewable energy, garment industry and real estate rental projects.
“Private debt is an attractive product for companies looking for alternative funding, as we can see from the number of companies applying to the Fund and their individual needs. Sometimes even businesses that receive bank financing implement projects that require a more flexible, faster and customised solution,” says Viktorija Vaitkevičienė, CEO of Mundus, the asset management company that manages the INVL Bridge Finance private debt fund.
Since its launch in 2015, INVL Bridge Finance has already financed 25 companies through almost 200 transactions and more than EUR 220 million in corporate bond issues. The private debt fund has provided funding for renewable energy projects, the development of a car fleet, leasing and consumer loan companies, the acquisition of forest and agricultural land and business development in foreign countries, and projects in other sectors.
Expected return
In H1 2024, the open-ended investment fund for informed investors attracted over EUR 2 million from investors (retail and corporate clients, including institutional investors).
Currently, the average annual return on the funding granted by INVL Bridge Finance is more than 13%. The Fund is expected to achieve the 9-10% return for investors over the next 12 months, says V. Vaitkevičienė.
“The Fund’s core strategy is to seek long-term stable return by investing in private placement debt securities of companies in the fast-growing alternative financing sector and to provide bridge financing for a wide range of projects. Private placements allow the Fund to directly supervise investments and avoid additional costs related to underwriting and prospectus preparation, thus generating higher returns for investors. We follow a short-term investment strategy, so the average duration of the Fund’s portfolio ranges from five to seven months, which allows us to maintain liquidity and respond quickly to the changing market situation,” claims the CEO of the company managing INVL Bridge Finance.
The Fund’s units are an attractive product for investors, as they can be purchased on a monthly basis and sold to the Fund each quart, after a one-year “freeze” period on the investment.
“Traditionally, institutional investors have been the largest investors in private debt funds, but institutional investors in the Baltic States are not yet very active in private debt funds. Our Fund’s investors are mainly natural or legal persons seeking higher long-term returns”, says V. Vaitkevičienė.
100% of Mundus shares are managed by INVL Asset Management, a part of Invalda INVL, the leading asset management group in the Baltic States.
About Invalda INVL group
Invalda INVL is the leading Baltic asset management group with a track record spanning over 30 years. The group’s companies manage EUR 1 billion of assets across multiple asset classes including private equity, forests and agricultural land, renewable energy, real estate as well as private debt. The group’s scope of activities also includes family office services in Lithuania, Latvia and Estonia, management of pension funds in Latvia, and investments in global third-party funds.
Important notice
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