Launch of new private debt fund recognises demand for more lending funds in EU approved, AIFMD compliant structure.
Prestige Funds is to launch a new direct lending fund focusing on agricultural and SME businesses in both the United Kingdom and the Republic of Ireland. Called Prime Alternative Finance (PRIME), it will launch in November to external investors as a Luxembourg based, SICAV SIF operating with monthly liquidity and managed by Prestige Capital Management in Malta.
PRIME is the first direct lending fund to be launched by Prestige that will have the mandate to invest in the Republic of Ireland as well as the United Kingdom. Prestige’s existing direct lending funds have focused entirely on the UK to date (although the wider Prestige business has significant experience lending in Northern Ireland and several team members were previously employed by Allied Irish Bank).
The Fund will provide agricultural/SME loan finance for ‘on farm energy’ related projects as well as asset finance related opportunities. Prestige estimates that PRIME will have £300-400m of potential deal flow opportunities over the next several years. Through its investment in a dedicated UK based, agricultural specialist finance arranger which has existed for almost 18 years and has conducted approximately 15,000 loans to 6,000 loan customers, Prestige has developed a highly experienced team of direct lending professionals who specialise in agriculture, energy and SME lending.
Craig Reeves, founder of Prestige, commented: “The critical farming sector in the British Isles is an important market for secured lending, with private debt replacing commercial bank lending in many areas of the agricultural economy.
‘On farm energy’ is also playing a key role in helping farms to adjust to higher energy costs, reduce waste and generate alternative income while also indirectly supporting governments in the achievement of their future clean energy objectives.”
Prestige has been operating in the direct lending market for more than a decade and has raised over $1.5 bn for UK direct lending strategies during that period from many hundreds of professional investors globally. Now this investment strategy is available as a regulated Luxembourg (EU) Fund (SICAV).
Added Craig: “Responding to investor demand, we have launched PRIME as a Luxembourg-approved, AIFMD compliant structure that will allow more investors to access exposure to this strategy. This is the first time we will also be lending in the Republic of Ireland, which has a considerable agriculture sector that has similar requirements in terms of gaining finance to improve productivity.”
The fund will operate with monthly liquidity and will be targeting returns of 5-7% per annum (depending on share class and currency) and has no performance fee. There are three main share classes available: advisory and institutional accumulation classes and an institutional distribution class. Share classes are denominated in GBP/USD/EUR/SEK and CHF.