Direct lenders poised for action in uncertain market Deloitte Alternative Lender Deal Tracker Spring 2021 This issue covers data for the second half of 2020 and includes 232 Alternative Lender deals. While this represents a 52% increase in the number of deals from H1 2020, there was a 25% decrease from H2 2019.
Deloitte Alternative Lender Deal Tracker editorial team
Robert Connold Andrew Cruickshank Megan de Jager Varun Bambarkar Edward Rushworth Head of Alternative Director Manager Deputy Manager Assistant Manager Lender Debt Advisory +44 (0) 20 7007 0522 +44 (0) 20 7007 5914 +91 22 6185 6311 +44 (0) 20 7007 6438 +44 (0) 20 7007 0479 [email protected] [email protected] [email protected] [email protected] [email protected] Deloitte Alternative Lender Deal Tracker Spring 2021 | Contents
Contents
Deloitte Alternative Lender Deal Tracker Introduction 02
Alternative Lending in action: Case study 06
Alternative Lending in action: Nordics 09
Alternative Lender Deal Tracker H1 2020 deals 13
Direct Lending fundraising 20
Diversity Review in corporate credit 34
Insights into the European Alternative Lending market 38
Deloitte Debt and Capital Advisory 50
© Deloitte Alternative Lender Deal Tracker 01 Alternative Lender Deal Tracker Spring 2021 Introduction 02 whom Deloitte is tracking deals Europe. across tracking is Deloitte whom than in the preceding 6months. covers Our report 63 major Lenders Alternative with the same period in the previous year. However, lending in H2 2020 was 52% higher that in H2 2020, there was a25% decrease in Lending Alternative deals compared to editionAlternative theof Deloitte Lender Deal In this twenty-fifth Tracker, we report Introduction Tracker Deal Lender Alternative Deloitte 2021 Spring Tracker Deal Lender Alternative Deloitte £215 billion in February 2021. February in £215 billion reaching borrowing net sector public with 1960s, the since seen not levels at borrowed Government UK the generally, conditions economic to in response and industries those up shore to effort an in Consequently, holidays. and activities leisure out, meals as such services consumed socially on goes nation, G7 any in than more spending, consumer UK of proportion high unusually an Moreover, Eurozone. the for average 53% the than higher far and US, the than other economy wealthy any GDP, than UK higher of 64% for accounts spending Consumer Depression. Great the in even seen anything than worse far years, 300 over in contraction annual largest the also and Spain, than other Europe, in economy sizeable any of decline sharpest the was This accounting. sector public for methodology in differences for adjustment before GDP in decline a9.9% posting lockdowns, three its by hard especially UKglobal economy. economy was hit consumption-heavy The the for year adreadful 2020 was it, measure you way Whichever © Deloitte Alternative Lender Deal Tracker Introduction | event since the Second World War. World Second the since event any than sheets balance government to damaging more be to set COVID-19 looks world, Western the of much across seen being picture asimilar and rise to continuing costs £150 With billion. than more slightly only 2009-10 reached in Crisis Financial Global the following borrowing net total perspective, into To this put 52 v v flow deal ncrea e in 2,694
completed deals Total Alternative Lender Deal Tracker Spring 2021 Introduction 03 | Introduction | © Deloitte Alternative Lender Deal Tracker Deloitte Alternative Lender Deal Tracker Spring2021 The private debt market has successfully has market The debt private defying so far any pandemic, the navigated the to Prior crisis. a debt about worries a that believed commonly it was pandemic, deal of a reset allow would crisis documentation which of in the balance lender. to shift borrower would from power Despite such a momentous year for the global economy, the loan loan the economy, global the for year momentous a such Despite markets have held up with remarkable resilience. Whilst deal activity was suppressed in the second and third quarters of 2020, private markets rebounded strongly in Q4 of 2020, and public markets Finance of in 2021. in Q1 support of the buyout of ASDA got the market off to a flying start in January; its new owners pulled in over £8bn of orders for their £2.75bn debt issue, making it the largest sterling high yield bond issuance ever seen in the European market, and one where the subordinated tranche was priced at the skinniestpremium seen by the market While since 2010. the high-yield bond market in the UK is very active, it lacksthe depth of liquidity of the dollar andeuro markets and sterling has traditionally been seen as a niche currency. According total to LCD, primary in January issuance wasof €11.6bn the 2021 largest recorded in the past months, 12 and almost everytransaction completed in the primary market in the year to date was on terms inside those originally guided, some as much as a 75bps delta. This strength of demand is equally reflected in the secondary market, where the average bid of LCD’s European loan flow-name composite stood at 99.68 of par on 25 February, a touch away from a pre-lockdown high of in 103.39 January 2020. While the UK plans to increase tax receipts to solve its growing deficit problem, we seem to be witnessinga historic shift in thinking on US fiscal policy. Put simply, the US plans to spend its way out of the pandemic. In late February, the new Treasury secretary Janet Yellen declared it was time to “act big” on fiscal policy to boost US growth and on6 March the US Senate passed the administration’s stimulus $1.9tn package to support growth. Later this year the administration plans to go further, with new spending on infrastructure, climate change, education, digital transformation and healthcare. together Taken the measures could be worth The 9% booming of US GDP. US equity market, up 20% since last November’s elections, shows that investors are positioned for a strong recovery. The big question is whether the recovery will leave the US economy operating above capacity, risking a serious and persistent inflation overshoot. The US bond market reacted swiftly with a sell off and spike in yields, which jumped to one-year highs on the of 1.6% 10-year benchmark note, having started the month of February at 1.1%. To softenTo the impact of continued restrictions in the interim period, the UK Chancellor delivered his second budget, outlining an extension of the furlough scheme until the end of September, additional grants for the self-employed, an extension to business rates holidays, and reduced for rates sectors of VAT most impacted by the pandemic. Despite liberal use of the word ‘generous’, there was one surprise in the form of a plan to increase the mainrate of corporation tax from to 25% by 2023. 19% While such a rise in business tax will be partially offset by a new tax ‘super-deduction’ forof 130% eligible investment, this marks a significant move away from the Conservative low-tax ideology, not to mention the highest rate of tax increase in almost three decades. That said, there are high hopes for an extraordinary rebound in In late February,2021. the UK Prime Minister set out his ‘roadmap’ to ease current public health restrictions. Schools reopenedon 8 adverse barring any developments, and hospitality outdoor March and retail will reopen April, on the 12 indoor hospitality and domestic holidays will be permitted from and May, all the other 17 remaining restrictions will be lifted from the June. 21 Deloitte Alternative Lender Deal Tracker Spring 2021 | Introduction
…the influx of IPO and special-purpose Whilst contrary to expectations there has been no let-up in commitments sought by distressed funds, managers in this space acquisition company (SPACs) activity is are yet to deploy at any great scale. Ultimately, the real fallout from the pandemic is yet to come, as many corporate borrowers under funnelling liquidity back to investors. stress continue to defer rent and rates and make use of government support in the form of furlough and the Coronavirus The private debt market has successfully navigated the pandemic, Business Loan Interruption schemes. This is evident in a recent so far defying any worries about a debt crisis. Prior to the slowdown in the rate of downgrades, which has led to optimism pandemic, it was commonly believed that a crisis would allow a that defaults will remain below expectations this year. Data from reset of deal documentation in which the balance of power would LCD shows that there were only 17 downgrades in the S&P shift from borrower to lender. So far, there’s little sign of it. After European Leveraged Loan Index in the three months to January three consecutive quarters of declining numbers, European direct this year, which is the lowest since December 2019. But is it a case lending activity surged in Q4 of 2020, driving the number of deals of watching and waiting? The answer lies in whether the economy is up to 155, the highest ever recorded Q4 level and a 2% increase on likely to experience a gradual but choppy economic recovery, or the previous year’s record. The most attractive assets in the something more cataclysmic later this year. For corporate Technology, Healthcare and Financial Services sectors continue to borrowers, insolvency risks are likely to increase if cash flows and attract terms stronger than those received pre-pandemic, and earnings do not return to pre-pandemic trend levels before several gorilla funds continue to finance jumbo deals once reserved extraordinary fiscal stimulus is withdrawn. The next question is for the syndicated markets, with GSO announcing its £1.8bn whether those investors are prepared to sit it out on the side-lines, financing of Bourne Leisure. In a departure from the norm, The or whether there is an interim stage during which participants Restaurant Group became the latest listed borrower to tap the begin acquiring debt tranches from bank lenders that are looking private debt market in its £380m financing from HPS. to shed their exposure in the expectation that any future stress will lead to a reprofiling of terms. Alternative Lender Deal Tracker Spring 2021 Introduction 2021 Spring Tracker Alternative Deal Lender Meanwhile, the influx of IPO and special-purpose acquisition company (SPACs) activity is funnelling liquidity back to investors. Such activity only drives capital in private markets back to their The answer lies in whether the economy investors, which in turn drives those investors to reinvest in new is likely to experience a gradual but commitments if they are to maintain their allocations to the asset class. Earlier this year, Ares Management announced $11bn of choppy economic recovery, or something commitments for its fifth European credit fund, exceeding its more cataclysmic later this year. original target of $9bn and bringing the total funding to €20bn for its strategy in Europe - from humble beginnings of €311m in 2007. In a dissimilar but not unrelated vein, Investec and HSBC both recently announced a foray into the private debt market the former raising its own fund, and the latter agreeing a tie up with its asset management division.
04 © Deloitte Alternative Lender Deal Tracker Alternative Lender DealAlternative Tracker Spring 2021 Introduction Deloitte Alternative Lender Deal Tracker Spring 2021 | Introduction
H2 2020 deals completed Robert Connold Head of Alternative Lender Debt Advisory Tel: +44 (0) 20 7007 0479 Email: [email protected]
Thomas Lahmer Director– Debt Advisory Austria Tel: +43 (1 ) 53700 2722 Email: [email protected] 232 Deals
rance er an t er ro ean Andrew Cruickshank Director – Alternative Lender Debt Advisory H2 headline figures Tel: +44 (0) 20 7007 0522 Email: [email protected] deal co nt e t o ro e deal co nt
Access Direct Lending to power growth deal co nt Businesses rely on access to growth capital, yet due to their e t o ro e deal co nt risk appetite and stringent regulation, banks are constrained. Alternative and flexible sources of capital allow companies to grow, although the market can be overwhelming, with numerous complex loan options available to borrowers. Direct Lenders can offer attractive rates with little or no equity dilution of your business, enabling you to make acquisitions, refinance bank lenders, consolidate your shareholder base, and invest in growth. To read more, turn to our Direct Lending guide on page 27.
© Deloitte Alternative Lender Deal Tracker 05 Alternative Lending in action: Case study 06 Case study action: in Lending Alternative 2021 Spring Tracker Deal Lender Alternative Deloitte © Deloitte Alternative Lender Deal Tracker | Alternative Lending in action: Case study Case action: in Lending | Alternative Alternative Lending in action: Case study 07 | A lternative Lending in action: Case study © Deloitte Alternative Lender Deal Tracker W HGGC, a firm that is completely completely is that a firm HGGC, a as with values our aligned people-driven and culture a common share We company. ethos and expansive ambition, excited tremendously I am and SRG the of next the for chapter story” “ partner to with delighted e are Warren Downey, SRG Group CEO Deloitte Alternative Lender Deal Tracker Spring2021
With nearly years 100 of trading history in the sector, UK-headquartered Specialist Risk Group (SRG) insurance the critical but of segment niche a occupies broking market, sitting between independent smaller providers and premium consolidators, and larger global generalists. The role international and conglomerates SRG plays in connecting insurers with retail brokers and policy holders is a key component of the value chain it operates in, and its specialist approach creates a highly ‘sticky’ customer base. This in turn provides a crucial foundation for driving the top line growth in its business. The company’s mantra “Difficult. Done Well” perfectly encapsulates its proficiency in placing risks across the full spectrum of ’difficult-to-insure’ industries and schemes, such as asbestos removal, waste & hazardous chemical recycling, and property repossession. Of the company’s £320m+ gross written premiums, around 80% are non-standard, underlining its unique offering and positioning in the insurance space. The modern Specialist Risk Group has its origins in the acquisition of Miles Smith Insurance Group (UK speciality broking) and The in 2018 Underwriting Exchange (Irish speciality broking) by Pollen in 2019 Street Capital (PSC). With the backing of California-based sponsor HGGC, insurance broker broker insurance HGGC, sponsor California-based of With backing the and organic strong achieve to positioned is Group Risk Specialist of leadership the under years growth coming the in acquisition-driven capable highly and experienced with his together Downey Warren CEO management team.
acquisition with bespoke Unitranche facility Direct lendersfund HGGC’s latest Warren Downey CEO, SRG Colin Phinisey Principal, Head Debt Capitalof HGGCMarkets, Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lending in action: Case study
“ The direct lending capital structure that Aside from the regulatory and logistical dynamics of a cross-border transaction, the financing presented challenges due to the bespoke the Deloitte team helped us put in place structure required, and also the need for flexibility to ensure that the allows us to partner with relationship- offer was appropriate for financing both HGGC’s investment and also its anticipated pipeline of acquisitions and ongoing working capital minded lenders and will provide us with requirements. As advisors, Deloitte supported HGGC throughout the flexibility to effectively execute our the financing process, leveraging a large network of market contacts to initiate dialogue with a range of potential financing providers, and M&A strategy.” filtered them to create a concentrated pool of the most credible lenders to provide the structure required. Deloitte assisted HGGC Colin Phinisey, HGGC with managing the lender due diligence process, organising lender meetings with the sponsor and management, involvement in The Group was formed following the appointment of the CEO term sheet negotiations, and liaising directly with lenders, sell side Warren Downey to establish a foundation for a more comprehensive advisors and legal counsel to ensure the right structure and terms offering. The subsequent acquisitions of LIME, Square Mile Broking were delivered to HGGC. The deal closed on 26 February 2021, with Alternative Lending in action: Case study in Alternative Lending and David Codling and Associates in 2019 enhanced the company’s HGGC’s Fund IV acquiring a majority ownership and the existing retail business portfolio, and in the past 12 months alone the management team rolling over a portion of equity alongside it. company has completed a further five acquisitions, signalling to the The debt was provided by Ares. sector its intent to continue consolidating the fragmented, specialist insurance broking market, and also proactively expand its customer “ This transaction is another good base of 1,200 broker clients and 45,000 policyholders. example of the continuing strong The exit of Pollen Street Capital provided an opportunity for a appetite from direct lenders for assets new investor to inject fresh capital into SRG and drive a new and exciting growth story for the coming years. This opportunity that are perceived as COVID-19 resilient.” was seized towards the end of 2020 by the team at HGGC, a California-based mid-market fund with $5.4 billion in cumulative Robert Connold,Head of Alternative Lender Debt Advisory capital commitments. HGGC mandated Deloitte’s Debt & Capital Advisory team to act as its advisors assist in accessing liquidity from the European direct lending market. Targeting direct lenders specifically allowed HGGC to raise its target level of financing within a compressed timeframe, despite the difficulties presented by the global economic climate and ongoing COVID-19 pandemic.
08 © Deloitte Alternative Lender Deal Tracker Alternative Lending in action: Nordics action: in Lending Alternative Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lending in action: Nordics
Alternative Lending in action: Nordics
© Deloitte Alternative Lender Deal Tracker 09 Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lending in action: Nordics
Nordic lending market perspectives
The demand for alternative financing has grown steadily in the Nordics over the past few years. 2018 and 2019 saw record levels of activity, with the Alternative Lender Deal Tracker documenting 37 deals in each year. Despite the COVID-19 pandemic, activity was robust with 33 deals completed in 2020. Alternative Lending in action: Nordics Following a trend previously seen in the UK, France Moreover, the Nordics are characterised by their and Germany, private equity activity proved to be a resilient economies, healthy financial and political catalyst for alternative lender deal activity. The software, environments and lender-attractive businesses. The technology and healthcare sectors, driven by higher region held up relatively well in 2020 despite the valuation multiples with increased leverage, have been pandemic, with GDP falling 3-4% across the Nordics the most active in recent years. compared with a drop of about 7% across the Eurozone. The region also has attractive socioeconomic features, It is expected that alternative lending will flow into new such as a quality education system and high levels of Morten Husted market sectors and non-PE-backed businesses in the disposable income. Permin future, as seen elsewhere in Europe, as more pan- Partner, Head of European funds look to the Nordic market for untapped Despite these fundamentals, alternative lending is less Nordic Debt & opportunities. prevalent than elsewhere in Europe. Higher capital Capital Advisory ratios and profitability going into the Global Financial Market characteristics Crisis enabled Nordic banks to preserve their market The regulatory environments across the Nordics are share following the financial crash, unlike banks in other some of the most welcoming to businesses in the world. European countries. Strong relationships with private According to the Ease of Doing Business Index (World equity firms and competitive pricing against alternative Bank Group), the Nordic countries rank amongst the lenders have allowed the banks to continue to retain top 10 globally. While laws and regulations vary across this foothold. Another factor is that the banks can the Nordics, they are generally lender friendly, and both always provide local currency funding, although this is borrowers and lenders can benefit from stable and an advantage only in Sweden and Norway, rather than David Burton transparent regimes. in Finland (which uses the euro) and Denmark (whose Director, Nordic currency is pegged to the euro). Debt & Capital Advisory
10 © Deloitte Alternative Lender Deal Tracker Alternative Lending in action: Nordics action: in Lending Alternative Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lending in action: Nordics
As elsewhere in Europe, business valuations have risen to all-time highs, buoyed up by the unprecedented global monetary stimulus. Case study: Axcel and refinancing Loopia Group Furthermore, throughout 2020 as businesses struggled due to In autumn 2020, Nordic private equity house Axcel wanted reduced customer demand and the impact of lockdowns, banks to refinance a portfolio company it acquired in June 2018, the became more risk-averse and switched their focus from actively innovative web services and hosting business Loopia Group. seeking new clients to supporting their existing borrower base, With an operational and acquisitions focus in the Nordics opening the market for alternative capital providers. and in Central and Eastern Europe, Axcel sought a degree of flexibility in its debt structure that was not currently Market drivers and trends provided by its existing club of lenders. As a result, it looked The resilience seen in the region during the pandemic, probably due for a new financing solution to support future growth and to in part to Sweden’s initial soft lockdown approach, underpinned the consolidation of Loopia’s existing operations, following a an increase in deal completions both Sweden (with 20 deals closing spate of recent acquisitions by the company. in 2020 compared to 18 in 2019) and Norway (8 deals closing Deloitte’s Nordic Debt & Capital Advisory team was compared to 6 in 2019.). In Denmark however, where there were mandated to handle a complex and competitive refinancing 14 deals in 2018 and 12 in 2019, deal activity dropped by over 50% process within a two-month timeframe, which included in 2020. In the relatively nascent markets, Finland and Iceland, deal lender materials preparation, lender dialogue, terms activity in 2020 was low. negotiation and final execution. Various lenders, both Nordic and international, were approached to explore financing As in the rest of Europe, activity in the Nordic direct lending market options. These included amendments to the existing club is driven largely by sponsor-backed companies, which in 2020 deal, fresh bank financing, and also comprehensive accounted for over 80% of all direct lending deals closed. More than borrowing structures from the direct lending market. 90% of these deals funded acquisitions. M&A activity in general Deliverability and flexibility of terms were the key objectives rebounded strongly in the second half of the year, and growth of the refinancing. Based on a careful assessment of lenders, is expected to continue into 2021, further driving demand for a unitranche structure provided by Arcmont Asset alternative lending. Management was chosen, due to its ability to deliver within a very tight deadline, the flexible terms granted, and the availability of further growth capital.
© Deloitte Alternative Lender Deal Tracker 11 Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lending in action: Nordics
We also expect non-bank financing to become more commonplace Active lenders in the market in the wider corporate sector. However, cultural barriers such as The Nordic alternative lending market is dominated by both local language and having a local presence could inhibit adoption to and international private credit funds. some extent. To overcome these barriers, a growing number of international lenders are establishing local offices. There was a marked increase in deal activity and fundraising by domestic funds in 2020. Capital Four launched its third direct lending High yield corporate bonds are another source of non-bank fund in 2020 with more than €500m out of a target fund size of €1bn Alternative Lending in action: Nordics financing. This has often been an attractive borrowing option for raised at first close in August. Nest Capital is in the process of raising some companies motivated by price rather than flexibility in terms. its third fund, with an expected launch during the spring of 2021 As of 31 December 2020, outstanding volume on the Nordic high and a target fund size of over €100m; and Kreditfonden is targeting yield market stood at €46bn (according to trustee and loan agency a mid-2021 launch of a fund with a target size of €500m. The steps service provider Nordic Trustee). taken by domestic lenders to raise additional capital to boost direct lending capabilities can be seen as a vote of confidence in the Nordic With less burdensome listing and reporting requirements, issuing alternative lending market as a whole. high yield bonds on the Nordic exchanges is a feasible borrowing option for many smaller businesses. This may explain why issuance International funds are also turning to the Nordic with growing sizes in the Nordics are relatively small compared to larger frequency, given the region’s attractive fundamentals. This can European markets – the majority of Nordic high yield bond issuances be seen in an increasing level of deal activity as well as a growing since 2019 have been under €100m. physical presence. Funds such as Ares, Blackrock, Bridgepoint, Crescent and Pemberton have already established local Nordic offices and overall a growing proportion of Nordic deals are being “ International funds are also turning to carried out by international rather than domestic funds. In 2018 the Nordic with growing frequency, given 54% of deals were executed by international funds; the percentage rose to 62% in 2019, and then still further to 79% in 2020. This the region’s attractive fundamentals. trend is true even for funds which do not have a local physical This can be seen in an increasing level of presence: for example Ardian provided both a unitranche and a dedicated acquisition facility to Denmark-based IT Relation, and deal activity as well as a growing physical Arcmont Asset Management recently provided financing to Loopia presence.” Group, a portfolio company of the Nordic private equity firm Axcel.
12 © Deloitte Alternative Lender Deal Tracker Alternative Lender DealAlternative Tracker Spring 2021 Deals Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lender Deal Tracker H2 2020 Deals
Alternative Lender Deal Tracker H2 2020 Deals
© Deloitte Alternative Lender Deal Tracker 13 Alternative Lender Deal Tracker Spring 2021 Deals 14 covers 63 lenders and areported 2694 deals Tracker Deal Lender now Alternative The Deals completed by each survey participant (Last 12 months) (Last participant survey each by completed Deals Deal survey. the in included are deals European and UK Only Lenders. Alternative leading 63 covers Currently Alternative Lender Deal Tracker 2021 Spring Tracker Deal Lender Alternative Deloitte © Deloitte Alternative Lender Deal Tracker in t e a t ont a t t e in deal ore or co leted artici ant rve lternative Lender Deal Tracker H2 2020 Deals 2020 H2 Tracker Deal Lender lternative | A in t e a t ont a t t e in co leted or ore deal artici ant rve e t o e t ro e dated or an ne artici ant retro ectivel i Tracker Deal Lender Alternative t e in Data rance 2,694 1,716 Total deal co leted co leted co leted ro deal 978 deal t er ro ean t er er an Alternative Lender Deal Tracker Spring 2021 Deals 15 UK Europe Rest of © Deloitte Alternative Lender Deal Tracker | A lternative Lender Deal Tracker H2 2020 Deals ine n ra tr ct re ro e ional ervice Teleco nication edia Tec nolo ervice inancial ealt care Li e cience Lei re an act rin etail ood on er Tran ortation Lo i tic and t er Services Goods. Consumer and In the rest of Europe there are 5 main industries: TMT, Healthcare & Life Sciences, usiness, Infrastructure & Professional Services, Financial Total deals across industries (Last months) 12 Within the UK, the usiness, Infrastructure & Professional Services and TMT industries have Alternative users dominant been the of Lending. Deloitte Alternative Lender Deal Tracker Spring2021 t er ro ean rance Total Deals er an t er ro ean er an rance
Total deals across Europe In the past 33 quarters 2,694 (978 other UK and 1,716 European) deals were recorded in Europe.
diversifying geographies Direct Lenders increasingly Alternative Lender Deal Tracker Spring 2021 Deals Lending Deals Lending still the key driver activity forM&A Direct 16 Unitranche is the dominant structure, with 63% of UK transactions and 50% of European transactions. Subordinate structures represent only only represent structures 13% of Subordinate the transactions. transactions. European of 50% and transactions UK of 63% with structure, dominant the is Unitranche 12Structures (Last months) 12 months, 57 did not involve a private equity sponsor. equity aprivate involve not did 57 12 months, last the in deals 385 the Of out. abuy fund to used being deals European 71% and UK the of with related, M&A are deals the of majority The 12 months) (Last purpose Deal *For the purpose of the deal tracker, we classify senior only deals with pricing L + 650bps or above as unitranche. Pricing below this hurdle is classified as senior debt. senior as classified is hurdle this below Pricing unitranche. as above or L+650bps pricing with deals only senior classify we tracker, deal the of purpose the *For Deloitte Alternative Lender Deal Tracker Spring 2021 Spring Tracker Deal Lender Alternative Deloitte t er e anine lien econd enior nitranc e ca ital ro t Refinancing reca Dividend A on olt L © Deloitte Alternative Lender Deal Tracker UK UK lternative Lender Deal Tracker H2 2020 Deals 2020 H2 Tracker Deal Lender lternative | A o t e tran action are tr ct red a a tr ct red are tran action t e o a first lien structure (Senior /Unitranche). (Senior structure lien a first involved ininvolved A o tran action first lien first Europe Europe Rest of Rest of Rest Alternative Lender Deal Tracker Spring 2021 Deals 17 ort al it erland eden ain or a oland © Deloitte Alternative Lender Deal Tracker | A lternative Lender Deal Tracker H2 2020 Deals tal inland reland Den ark A tria Other European Nordics Deloitte Alternative Lender Deal Tracker Spring2021 et erland L e o r er an
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Cumulative number of deals per country The number of deals is increasing at different rates in variousEuropean countries. The graphs below show countries that have completed 5 or more deals up to the year ending December 2020. deal volume for Direct Lenders in Europe in Lenders Direct for volume deal The UK still leading as the main source of of source main the as leading still UK The Benelux Largest geographic for markets Alternative Lenders Deloitte Alternative Lender Deal Tracker Spring 2021 | Alternative Lender Deal Tracker H2 2020 Deals
Direct Lending is growing in each of the main European markets
Comparison of deals for the past three years on a LTM basis for selected European countries On an average, over time the number of deals have been increasing with positive growth between 2018 and 2019 in the majority of countries shown below. Volatility in 2020 as a result of Covid-19 has disrupted this trend, but it it too early to determine the long-term impact.
UK France Germany
Alternative Lender Deal Tracker Spring 2021 Deals 2021 Spring Tracker Alternative Deal Lender
Netherlands Spain Italy
18 © Deloitte Alternative Lender Deal Tracker Alternative Lender Deal Tracker Spring 2021 Deals 19 Dec-20 Dec-20 Dec-20 Nov-20 Nov-20 Nov-20 Nov-20 Nov-20 Nov-20 Nov-20 Nov-20 Nov-20 Oct-20 Oct-20 Oct-20 Sep-20 Aug-20 Aug-20 Jul-20 Jun-20 Jun-20 Jun-20 Jun-20 Jun-20 Jun-20 Jun-20 Jun-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Dec-20 Date – – Sponsor © Deloitte Alternative Lender Deal Tracker | A lternative Lender Deal Tracker H2 2020 Deals Ares Debt Private Sachs Goldman CreditBridgepoint ICG Hayfin Hayfin Ares Ares Ares Ares Ares SMBC, Park Square, Barings, Bridgepoint Credit, Capza Ares Ares Ares Ares Ares Permira Alcentra Arcmont CapitalArcmont, Tikehau Barings Goldman Sachs Private Debt, SMBC, Park Square, Bridgepoint Credit, Northleaf Permira CapitalTikehau Ares Ares Arcmont CreditBridgepoint SquareSMBC, Park Five Arrows Tikehau Capital, CVC CapitalTikehau CapitalTikehau Debt Private Capital, Sachs Arcmont, Goldman Tikehau Arcmont Five Arrows Permira Debt, Private Sachs Arcmont, Goldman Lenders 1400 1200 1000 800 600 Deloitte Alternative Lender Deal Tracker Spring2021 400 Unitranche in €m in Unitranche 200 UK UK Country Netherlands Sweden France Sweden Belgium France Belgium Germany France Netherlands Sweden UK Spain Sweden UK UK UK UK UK France France France Italy UK France UK UK UK UK UK UK Belgium Netherlands Spain UK Germany
Ardonagh Rosemont/ Primrose Borrower Laboratoire X.O (Proton) EuroParcs Eleda Corilus TSG Solutions HealthcareVision Weka Heinenoord DOCUNordic Laboratoire X.O. Unifaun Amplitude Surgical Odigo Abrasives SurfacesTechnological Phenna PIB Technology Sensing Process Totalmobile Talan Atman Profand Eleda Wireless Logic Adler & Allan Angulas Aguinaga Consensus Thinkproject GRP Group Jagex Intracto Support Customs Group XLN Verastar ISI Emerging Markets DWS Questel Source: LCD, an offering of S&P Global Market Intelligence, Deloitte research and other publicly available sources.
been completed? Which landmark unitranche deals have Selected Landmark Unitranche Deals (>€90m) Alternative Lender Deal Tracker Q1 2018Direct Lending Data Introduction fundraising Global direct lending fundraising by quarter fundraising lending direct Global Direct Lending fundraising Lending Direct 20 by region (2013-2020) fundraising lending Direct Deloitte Alternative Lender Deal Tracker Spring 2021 Spring Tracker Deal Lender Alternative Deloitte Data o rced ro o rced Data e t o t e orld t e o e t ro e A erica ort n © Deloitte Alternative Lender Deal Tracker n n n 1 n n n er o nd n 1 irect Lending fundraising Lending irect | D n n Selected largest US funds with final closing in 2020 in closing final with funds US largest Selected • • • • • • • • • • 2020 in closing final with funds European largest Selected
Antares Senior Loan - Loan Senior Antares 2019 - Situations &Special Distressed Capital Bain - Fund Opportunities Special Ares - VI Partners Capital Clearlake 2019 - Partners Mezzanine HPS Arrow Credit Opportunities – Opportunities Credit Arrow - Fund Ocean Blue - Fund Dislocation KKR - IV Fund Solutions Credit Permira - II Fund Debt Senior European GSO $2,100m $3,000m $2,800m €1,700m $7,000m $11,000m $3,500m €3,400m $6,102m $3,200m 1 1 AlternativeDirect Lending Lender fundraising Deal Tracker Q1 2018 Data Introduction 21
| D irect Lending fundraising © Deloitte Alternative Lender Deal Tracker 1 1 1 North American focused private debt fundraising hit $74.4bn in funds closed with – up from in in2020 113 2019, 2020, $67.3bn up from 99 funds closed during 2019 Direct Lending was the most popular strategy in terms of funds closed and (43) aggregate capital raised – just ($23.7bn) Mezzanine funds raised a total with of $21.5bn, funds 21 closed, indicating that on average these funds were larger Private debt has fared well during what has been a difficult economic period, with future AUM growth to be driven by investors’ search for yield and higher returns Private debt (PD) is now the third largestasset class in private capital, behind only private equity and real estate Fundraising in PD was robust over 2020, with 200 funds closed raising an aggregate slightly $118bn, below total the 2019 Most of this capital was raised by the largest funds, with the top 10 PD funds raising 39% of the total capital, – in 2019 up from 31% increased competition for deals has also led to a larger proportion of mega deals (valued in the private at$1bn+) debt space Overall, fundraising in Europe was hit harder than the US, With returns on European 10-year government debt generally in negative territory, it’s likely that many more European investors will increase allocations towards the asset class with funds 45 closed, raising $36.8bn – the equivalent figures were funds 59 for 2019 closed, raised with $51bn funds closing, representing 56% of all funds closed. These funds accounted for $23.4bn of capital raised equal to 63% of the total Direct Lending funds dominated closures in Europe, with 25 The largest single Europe-focused private debt fund closed was the GSO European Senior Debt Fund II, which raised $6.1bn
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Lending Direct which How much funding has been raised by 2021 Spring Tracker Deal Lender Alternative Deloitte Bain Capital Ares SpecialOpportunitiesFund,L.P. Ares Axa PrivateDebtFundIV Ardian Arcmont SeniorFundIII Arcmont AssetManagement Apera CapitalPrivateDebtFundI Apera Capital European DirectLendingFundIII Alcentra Alteralia SCASICAVRAIF Alternative Lenders Bain CapitalMiddleMarketCredit2018 ACE IV Ardian PrivateDebtFundIII Arcmont SeniorLoanFundI Direct LendingFund Alteralia SCASICAR Bain CapitalSpecialtyFinance Alantra ACE III Axa PrivateDebtFundII Arcmont DirectLendingFundII European DirectLendingFund Bain CapitalDirectLending2015(Unlevered) ACE II Arcmont DirectLendingFundI Direct LendingFund Bain CapitalDirectLending2015(Levered) ACE I Bain CapitalMiddleMarketCredit2014 © Deloitte Alternative Lender Deal Tracker irect Lending fundraising Lending irect | D Q2 20 19 Q2 19 Q1 19 Q1 19 Q3 20 Q1 Date Q3 18 Q2 18 15 Q3 17 Q3 17 Q1 15 Q3 Q4 16 Q2 16 Q2 10 Q2 Q4 15 14 Q4 Q4 15 Q3 13 Q3 13 Q2 12 Q4 Q1 15 Q1 Q4 07 Q4 Q4 13 13 Q4 Size (m) w/o leverage Size €3,500 €3,300 €6,000 €750 €5,500 €200 €870 €6,500 €2,026 €2,900 €2,100 €139 €1,406 €2,536 €1,529 €2,100 €850 €56 €911 €810 €278 €433 €311 €1,554 €1,554 Investment Strategy Senior Junior and Senior Junior and Senior Junior and Senior Junior and Senior Senior Junior Senior Junior and Senior Senior Junior and Senior Senior Senior Senior and Junior and Senior Junior and Senior Senior andJunior Junior and Senior Junior Senior and Junior and Senior Junior and Senior Junior and Senior Junior Senior Junior Europe Europe Europe Europe Europe Europe Global Geography Europe Europe Europe Europe Europe Global Europe Europe Europe Europe Global Europe Europe Europe Global Europe Global Direct Lending fundraising 27 Europe Europe Europe Europe Europe Europe Europe Europe Global Global Europe Europe Europe Global Europe Europe Europe Europe Europe Europe Europe Europe Global Europe Geography Europe Europe Europe Europe Europe Europe Europe Europe Europe Global Europe Europe Europe Europe | D irect Lending fundraising © Deloitte Alternative Lender Deal Tracker Senior and Junior Senior and Junior Senior and Junior Senior Senior and Junior Junior Junior Junior Senior Senior and Junior Senior Senior Senior and Junior Senior Senior Senior and Junior Senior and Junior Junior Senior Senior Senior Senior and Junior Senior and Junior Senior Senior and Junior Senior Senior and Junior Junior Senior and Junior Senior Senior Junior Investment Strategy Investment €203 €325 €700 €345 $777 $4,000 € 135 €70 $1,300 $1,964 €530 € 350 €413 €122 €450 €1,500 $6,500 €270 €2,300 € 650 €850 €2,902 €350 €215 €55 €283 €1,017 $2,400 €1,100 $6,102 €200 Size leverage w/o (m) Deloitte Alternative Lender Deal Tracker Spring2021 Q1 05 Q3 07 Q3 12 Q3 15 Q2 16 Q112 Q3 15 Q3 15 Q3 17 Q4 15 Q2 16 Q3 19 Q1 18 Q1 15 Q3 13 Q3 19 Q4 16 Q2 16 Q2 19 Q3 18 Q4 20 Q1 18 Q4 20 Q3 20 Q1 18 Q2 19 Q4 19 Q2 18 Q4 20 Date Q2 10 Q1 17 Capzanine 1 1 Capzanine Capzanine 2 2 Capzanine Capzanine 3 3 Capzanine Artemid Senior Loan Artemid Loan Senior Global Private Loan Fund I Global Private Loan Fund I Capital Opportunities Fund Capital Four Strategic Lending Fund Artemid CA Global Private Loan Fund II Global Private Loan Fund European Senior Debt Fund Bridgepoint Direct Lending I Capital Four Strategic Credit Fund Artemid Senior Loan 2 Céréa Mezzanine III Claret European Growth Capital Fund I Ireland Corporate Credit DAC European Private Loan Fund II European Private Loan Fund II Capital Opportunities Fund Céréa Dette Dexteritas Dutch Credit Opportunities Fund Dunport Capital Management Elm Corporate Credit DAC Claret Capital Partners Claret European Growth Capital Fund II SCSp Dexteritas Céréa Dette II Carlyle Carlyle Credit Opportuniites Fund, L.P. Céréa Capzanine Capzanine 4 Private Debt Capital Four Capital Four - Private Debt III – Senior Bridgepoint Credit II Bridgepoint Direct Lending GSO European Senior Debt Fund II GSO European Senior Debt Blackrock Market Private Debt Fund I BlackRock European Middle Blackstone Credit Global Private Loan Fund III Global Private Alternative Lenders Alternative Market Credit 2010 Bain Capital Middle Barings Direct Lending fundraising 28 Deloitte Alternative Lender Deal Tracker Spring 2021 Spring Tracker Deal Lender Alternative Deloitte Idinvest SeniorDebt5 Idinvest Senior DebtPartnersIII ICG 2016 Fund Loan Speciality HPS Investment Partners H.I.G. WhitehorseLoanFundIII HIG II Fund Lending Direct Hayfin Five ArrowsDirectLending Arrows Five EMZ 9 EMZ Eiffel 5 Group Investment Eiffel Dutch MezzanineFundII Alternative Lenders Idinvest PrivateDebtIV Senior DebtPartnersII Fund III Partners Mezzanine H.I.G. BaysideLoanOpportunityFundV(Europe) I Fund Lending Direct Five ArrowsCreditSolutions EMZ 8 Dutch MezzanineFundI Dutch Mezzanine Idinvest DetteSenior4 ICG EuropeFundVI Loan Fund III Highbridge Speciality 7 EMZ Idinvest DetteSenior3 Senior I Debt Partners II Fund Partners Mezzanine EMZ 6 Idinvest DetteSenior2 V Fund Europe ICG Loan Fund IIHighbridge Speciality Idinvest PrivateDebtIII I Fund Partners Mezzanine Idinvest PrivateValueEuropeII Idinvest DetteSenior Idinvest PrivateValue Europe Idinvest PrivateDebt © Deloitte Alternative Lender Deal Tracker irect Lending fundraising Lending irect | D Q4 20 Q4 17 17 Q3 13 Q1 17 Q1 18 Q1 20 Q1 20 Q4 17 Q2 Date Q2 18 Q3 15 16 Q4 19 Q2 14 Q1 14 Q2 17 Q4 13 Q1 Q4 16 Q1 15 13 Q2 14 Q1 Q3 15 13 Q2 13 Q1 09 Q1 Q3 14 13 Q1 10 Q2 Q1 14 08 Q1 Q4 13 Q1 13 Q2 12 Q3 07 Size (m) w/o leverage Size €400 €5,200 $4,500 €750 €3,500 €655 €1,043 €278 €122 €715 €3,000 $6,600 $1,500 €2,000 €415 €815 €60 €300 €3,000 €3,100 €695 €530 €1,700 $4,400 €640 €400 €2,500 €1,100 €400 $2,100 €50 €280 €65 €290 Investment Strategy Senior Senior Senior Junior and Senior Senior Junior and Senior Junior Senior Junior Senior andJunior Senior Junior Junior and Senior Senior Junior Junior Junior Senior Junior Senior Junior Senior Senior Junior Junior Senior Junior Senior Senior andJunior Junior Junior Senior Junior Senior andJunior Europe Europe Global Europe Europe Europe Europe Europe Europe Geography Europe Europe Global Europe Europe Europe Europe Europe Europe Europe Global Europe Europe Europe Global Europe Europe Europe Global Europe Global Europe Europe Europe Europe Direct Lending fundraising 29 Global Global Europe Global Europe Europe Europe Europe Europe Europe Europe Global Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Geography Global Europe Global Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe | D irect Lending fundraising © Deloitte Alternative Lender Deal Tracker Senior and Junior Senior and Junior Senior and Junior Senior and Junior SituationsSpecial Senior and Junior Junior Senior and Junior Junior Senior and Junior Senior and Junior Senior and Junior Senior and Junior SituationsSpecial Junior Senior Senior and Junior Senior and Junior Junior Senior Senior and Junior Senior Senior and Junior SituationsSpecial Junior Senior and Junior Junior Senior and Junior Junior Senior and Junior Investment Strategy Investment $460 € 268 $1,336 €100 €225 € 104 € 752 €128 €100 $1,400 €508 $850 €474 €475 €65 € 153 € 815 €270 €200 $1,009 €870 $1,498 €1,350 €860 €65 € 707 € 835 €500 €220 € 250 Size leverage w/o (m) Deloitte Alternative Lender Deal Tracker Spring2021 Q4 12 Q4 16 Q2 15 Q3 14 Q1 13 Q1 17 Q4 13 Q4 12 Q3 00 Q1 14 Q1 15 Q1 16 Q1 15 Q2 14 Q1 14 Q3 17 Q1 15 Q3 16 Q3 03 Q4 20 Q1 19 Q4 18 Q4 17 Q4 18 Q3 19 Q1 17 Q3 18 Date Q2 18 Q3 07 Q4 15 Muzinich UK Private Debt Fund Fund Lending Partners I Muzinich Italian Private Debt Fund Fund Lending Partners II UK SME Debt MCP I Muzinich Iberian Private Debt Fund MezzVest III Incus Capital Iberia Credit Fund I III Fund Incus Capital Incus Capital Northleaf Private Credit Kartesia Credit Opportunities III Opportunities Credit Kartesia Partners Lending Fund Europe Private Debt Fund MCP II Mezzanine Partners I Muzinich French Private Debt Fund MV Senior Strategies Incus Capital Iberia Credit Fund II Fund IV Northleaf Northleaf Senior Private Credit MV Credit MV Subordinated IV Muzinich & Co. & Muzinich Muzinich Pan-European Private Debt Fund Mezzanine Partners Mezzanine Partners II Metric III MCP LGT Private Debt CEPD II KKR Lending Partners III (“KKRLP L.P. III”) Kartesia Credit Opportunities IV KKR Fund V Kartesia Indigo Capital Alternative Lenders Alternative Incus Capital European Credit Fund III Direct Lending fundraising 30 Deloitte Alternative Lender Deal Tracker Spring 2021 Spring Tracker Deal Lender Alternative Deloitte Swiss SMECreditFundI Tavis Capital Siparex IntermezzoII Siparex Scandinavian CreditFundIAB Skandinaviska KreditfondenAB Proventus CapitalPartners Proventus Pricoa CapitalPartnersV Pricoa Permira CreditSolutionsIV Permira Pemberton EuropeanStrategicCreditOpportunitiesFund Pemberton Park SquareCapitalPartnersIVSCSp Park SquareCapital Oquendo IV Alternative Lenders Siparex IntermezzoI Proventus CapitalPartnersIII Permira CreditSolutionsIII Pemberton EuropeanMid-MarketDebtFundII Park SquareCapitalEuropeanLoanPartners,LPInc. Oquendo Senior Oquendo Capital Proventus CapitalPartnersII/IIB Permira CreditSolutionsII European Mid-MarketDebtFund Park SquareCapitalPartnersIIILP Oquendo III Proventus CapitalPartnersI Oquendo II Oquendo I © Deloitte Alternative Lender Deal Tracker irect Lending fundraising Lending irect | D Q1 17 17 Q1 20 Q4 20 Q4 19 Q4 17 Q1 20 Q3 19 Q1 Q4 20 Q3 20 Date Q4 16 Q4 14 Q4 17 Q2 19 Q1 Q4 18 Q2 19 Q2 11 11 Q2 15 Q3 16 Q4 Q1 16 Q4 17 Q3 09 09 Q3 Q3 14 Q4 09 Size (m) w/o leverage Size CHF137 CHF137 €200 €390 €1,670 €1,692 € 3,500 €942 € 1,235 € 154 €100 €1,300 1,700 € €2,740 € 502 € 173 €835 € 800 €1,140 € 1,185 € 200 €216 €216 € 157 € 50 Investment Strategy Junior Junior Senior Junior and Senior Junior Junior and Senior Junior and Senior Junior Junior Junior Junior and Senior Junior and Senior Senior Senior Senior Senior and Junior Junior and Senior Junior and Senior Senior Junior Junior Senior and Junior Junior and Senior Junior Junior Europe Europe Europe Europe Global Europe Europe Europe Europe Geography Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Direct Lending fundraising 31 Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Geography Europe Europe | D irect Lending fundraising © Deloitte Alternative Lender Deal Tracker Senior Senior and Junior Senior Senior and Junior Senior and Junior Senior and Junior Senior Senior and Junior Senior Senior and Junior Senior Senior Senior Senior Senior Investment Strategy Investment € 355 € 134 € 230 € 19 € 290 € 610 € 615 € 205 € 212 € 2,200 € 297 €100 € 116 €400 € 120 Size leverage w/o (m) Deloitte Alternative Lender Deal Tracker Spring2021 Q4 13 Q4 13 Q3 14 Q3 15 Q3 15 Q3 16 Q2 17 Q4 17 Q1 18 Q1 19 Q4 19 Q4 20 Q4 19 Q4 20 Date Q4 20 Fund 1 Fund 2 Fund 3 Fund 4 Fund 5 Fund 6 Fund 7 Fund 8 Fund 9 Fund 10 Fund 11 Tikehau Hedda Credit Fund I Fund 12 Ture Invest Ture Invest Fund I Alternative Lenders Alternative Fund 13 Alternative Lender Deal Tracker Q1 2018 DataRecent Introduction moves 32 opportunities and private equity. equity. private and opportunities credit namely strategies, different for market the leave IPs of anumber saw H2 2020, throughout market the correct will that numerous replacement have triggered leavers hiring processes 16 H1 from in 2020. H2 2020 Whilst in 39 to increased, departures of H1, number the with consistent were H2 in rates hiring Whereas year. the of half second dthe fell levels experience senior and mid at numbers the and years, many for increase net smallest the 638, to 632 from increased (IPs) professionals investment of number the that shows 1 H1 2020. Figure from increasing barely headcount total with market hiring of the COVID-19in ramifications the 2020H2 saw Market Headcount Lending Direct Key and statistics recent moves professionals Lending Direct 2021 Spring Tracker Deal Lender Alternative Deloitte When analysing seniority, junior-level IPs are those with less than 6 years relevant experience, mid-level constitutes 6-10 years experience, and senior is those with more than 10 years experience. 10 years than more with those is senior and number whole experience, nearest 6-10 years the to rounded market. constitutes around placement numbers mid-level private Percentage experience, corporate the in is relevant 6years than activity less main with whose those teams are IPs excluded also junior-level have We excluded equity. have We seniority, majority or Capital). analysing When Crescent minority in is Square, Park as (such activity funds Lending investment /Direct their of Mezzanine majority combined large 35 c. the at where teams headcounts team investment investment total the included have we analysis this of purpose the For Notes between H1 2020 and H2 2020 H2 and 2020 H1 between seniority of levels different across moves 1. Net Figure © Deloitte Alternative Lender Deal Tracker headcount H1 2020 Total nior level net ove net ove id level enior level net ove ecent moves ecent | R headcount H2 2020 Total Figure Breakdown 2 of hiring diversity year on year.diversity gender in increase 2018 2017 asteady and (20%) (16%), indicating 2019 from (23%), increase an total, the of 28% up made hires female H1. 27% in from 2020, In increase an hires, female were H2 in hires all of 29% 2shows Figure increase. to continues hires of diversity Gender H1 in 2020. 22% and 58% of levels respective their from upsurge a show hires senior and junior while in H1 2020, 20% from drop-off notable most the show mid-level the at Hires 29%. hires senior-level and hires of 7% up made mid-level The hires. all of 64% for accounting junior-level, the at were hires of majority the seniority, Regarding UK. the in were hires of 67% H1 to when similar is trend hiring local This Benelux. and Spain Germany France, by followed UK, the in were hires of 69% 2020, H2 In Europe. in countries different across hires of percentage the shows 2(above) Figure ofBreakdown hiring
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Bruce Lock Bruce Managing Director [email protected] Andrew PerryAndrew Managing Director [email protected] © Deloitte Alternative Lender Deal Tracker Claes Styren left as VP for Anacap Credit Opportunities UniCredit from Principal joined Schall as Benjamin Mark Jochims left as Partner for TBC Anita Das joined as VP from PSP Michael Lucasleft as MD for HIG Whitehorse Thomas Athanasiou left as Director for TBC Miguel Fraguas Jover left as Director for KKR Charles De Villaines joined as MD from Macquarie Group Rakesh Pavithran and Samantha Wessels joined as Miguel Toney as Partner from Park Square Guido Lorenzi left Whitehorse Italy as Principal for QuattroR (PE) Pascal Meysson joined as MD, head of Europe, from Alcentra Rachel Zagajewski joined as VP from Park Square Peter Atkinson joined as MD from GIC Pablo Burgos Sainz joined as MD from Soc Gen Michael Small joined as Partner from Park Sq Natalia Novak joined asMD from CVC (advisory) Philipp Schroeder left as Director for TBC Directors from CS Lev Fin and out of the market respectively Deloitte Alternative Lender Deal Tracker Spring2021 Alcentra Apera Arcmont Ares Management Bridgepoint Bridgepoint Bridgepoint CIC CSAM CVC WhitehorseHIG WhitehorseHIG HPS HPS ICG KKR Proventus PSP Recent NotableDirect LendingMoves Advi or De t De t niver it enior Level enior Level enior rivate De t nd t o t e arket id Level id Level id rivate it nd nve t ent ankin Paragon Search Partners BruceLock and Andrew Perry are co-Managing Partners of Paragon search firmSearch focusedPartners, on the global credita London-headquartered markets, leveraged and acquisition finance, private investment equity. contact banking To and Bruce Lock at Paragon by email, use [email protected]. [email protected]. use email, by Andrew Perry Paragon at contact To Or to contact by phone the office telephone number is +44 (0) 20 5000. 7717 nior Level nior Level nior H1 2019 Figure 3. Sources of hiring at different levels of seniority in H1 2019 and H1 2020 H1 2020 H1 Universities were the 2nd largest source for junior hiring (23%), substantial increase compared to just PE played 9% in a H2 2019. significant part for the first time but these moves represent internal transfers across funds’ PE strategies. There was a fall in hires from debt advisory compared in H2 2020 to H2 2019. Source of hires – Breakdown – hires of Source Figure 3 compares the source of hiring at different levels of seniority and In H2 2020. 2020, investment in H2 2019 banks did themost hiring at thejunior-level and (43%) at the senior-level (40%), whereas competitor debtfunds represented the sole source of hires at the Mid-level, 23% of junior-level and at 27% the senior-level. Alternative Lender DealDiversity Tracker Q1 2018 review in Data corporate Introduction credit 34 Diversity review in review Diversity 2021 Spring Tracker Deal Lender Alternative Deloitte corporate credit © Deloitte Alternative Lender Deal Tracker iversity review in corporate credit credit corporate in review iversity | D
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o ‑ Raising junior HoldCoRaising debt junior To refinanceTo bank lenders in structuresover-levered Special dividend to shareholders dividend to Special Consolidation of shareholder base Corporates making transformational/ making Corporates bolt acquisitionsn Growth capital Private Equityacquisitions
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AlternativeInsights into Lender the European Deal Tracker Alternative Q1 2018 Lending Data Introduction market 39 Speed of execution eff ‑ simplicity
Cost ective
s ‑ Key solution Lenders One top benefits of Alternative
Scale © Deloitte Alternative Lender Deal Tracker Funds are not able to provide clearing facilities ancillaries. and Funds will target a higher yield for the increased flexibility provided.. Greater
flexibility structural • • However | I nsights into the European Alternative Lending market Potentially larger hold sizes for leveraged leveraged for sizes hold larger Potentially loans (€30m up to €300m). Deal teams of funds will continue to monitor the asset over the life of the loan Access to non amortising, bullet structures Ability to provide more structural flexibility(covenants, headroom, cash sweep, dividends, portability, etc.). Access to debt across the capital structure via senior, second lien, equity. quasi mezzanine and unitranche, Increased speed of execution, short credit processes and access to decision makers.
• • • • • • Key differences to bank lenders? Deloitte Alternative Lender Deal Tracker Spring2021
Over the last three years a significant number of new funds has been raised in Europe. Increased supply of Alternative Lender capital has helped to increase the flexibility and optionality for borrowers. These institutions range from larger asset diversifyingmanagers alternative into debt tosmaller funds newly set up by ex-investment professionals. Most of the funds have structures comparable to those seen in the private equity industry with a 3-5 year investment period year and a 10 withlife extensions The options. limited partners in the debt funds are typically insurance, pension, private wealth, banks or sovereign wealth funds. Alternative Lenders consist of a wide range of non-bank institutions with different institutions with non-bank of different range a wide of consist Alternative Lenders opportunity mezzanine, debt, private debt. distressed and including strategies Who are the Alternative Lenders and why are they becoming more relevant? Alternative guide Lender ‘101’ AlternativeInsights Lender into the Deal European Tracker Alternative Q1 2018 Data Lending Introduction market 40 • • • base investor Key of the characteristics credit of a Pansupportive documentation template by the Loan Market in (LMA) 2015 early Association is of Euromajority PPs are currently unlisted. The introduction of a standardised up significantly. amendmentAfter the thein insurance legislation in July 2013, the Since inception its in July 2012, the Euro Private Placement (Euro PP) volumes picked a glance at corporates mid‑cap for PP Euro Euro Private Placement ‘101’ guide 2021 Spring Tracker Deal Lender Alternative Deloitte
usually sponsor 3.5x), max. leverage (net profile credit good exposure, business international European mid Target lending: Buy and Hold strategy Hold and Buy managers and asset funds pension insurers, French Mainly © Deloitte Alternative Lender Deal Tracker ‑ l ess ‑ ‑ c E ap size, size, ap uropean roll • • • • of Euro PP Main features • • • • • • •
nsights into the European Alternative Lending market Lending Alternative European the into nsights | I no bond liquidity no bond and no trading listing, technical If listed: Loan or bond (listed or non or (listed bond or Loan Minimum issue amount: €10m amount: Minimum issue No rating secured) are banks if guarantees include to Senior,Usually (possibility unsecured to issue 8 weeks average on take PPs Euro language local Local jurisdiction, disclosure) (no financial confidentiality and transaction each for lenders of number Limited profile repayment Bullet >7 years Maturity fees upfront –No 4.5% 3% and between average on coupon Fixed facilities banking other with passu Pari ‑ o ut ofut this alternative source of financing. ‑ l isted) – isted)
Pros and Cons of Euro PP Euro of Cons and Pros Minimum credit profile; leverage profile; credit Minimum early of case in clause Minimum €10m amount hole Make General corporate purpose the to adapted and flexibility Covenant financial public (no Confidentiality for lenders of number limited Very funding of sources of Diversification (free repayment Bullet Long maturity < 3.5x < business disclosure) each transaction disintermediation) (bank repayment ‑ w ‑ u p cash flow)
AlternativeInsights into Lender the European Deal Tracker Alternative Q1 2018 Lending Data Introduction market 41 rivate n tr ent n tr ent lic Cash flow debt products The overview on the left focuses on the debt products available for Investment Grade Sub-Investmentand companies.Grade © Deloitte Alternative Lender Deal Tracker eer to eer | I nsights into the European Alternative Lending market i ield ond Direct Lender redit i k redit A Deloitte Alternative Lender Deal Tracker Spring2021 rivate lace ent AA enior ank Loan ilateral ndicated nve t ent rade ond AAA
cash flow debt products? debt flow cash How do Direct Lenders compare to other other to compare Lenders Direct do How De t i e De t AlternativeInsights Lender into the Deal European Tracker Alternative Q1 2018 Data Lending Introduction market 42 raising senior risk strategies funds with lower hurdle rates. rates. hurdle lower with funds strategies risk senior raising increasingly are lenders direct However, market. debt private the of part deepest the is which unitranche, vanilla’ ‘plain of strategy popular most the in involved mostly are and margin L+600bps above are which rates hurdle have Lenders Direct the of Majority equity. private by owned companies mainly to structures debt senior providing range margin 600bps to 350bps the in operate banks loan Leveraged lenders? bank How do Alternative Lenders compete with 2021 Spring Tracker Deal Lender Alternative Deloitte Margin 6 © Deloitte Alternative Lender Deal Tracker ank cl Alternative deal Lenders nsights into the European Alternative Lending market Lending Alternative European the into nsights | I nitranc e profile Risk 1 is a higher (real or perceived) risk associated with this investment this with associated risk perceived) or (real ahigher is there result a as and difficulty financial another or restructuring afinancial to economy and excess liquidity in the system. the in liquidity excess and economy the in improvements of aresult as 3years last the over down come has curve return risk the class asset other any to Similar capital. debt or growth unitranche and credit’1 subordinated including: ‘Story strategies, debt private yielding higher on focus funds Lending Direct Other ‘Story Credit’ – unitranche facility for a company that historically was subject subject was historically that acompany for facility –unitranche Credit’ ‘Story nitranc e or nior nitranc e de t tor credit tor Banks ro t ca ital ro t or nior de t rdle ate AlternativeInsights into Lender the European Deal Tracker Alternative Q1 2018 Lending Data Introduction market 43 arket Direct Lending landscape: m ‑ © Deloitte Alternative Lender Deal Tracker c ‑ | I nsights into the European Alternative Lending market Mid debt senior Traditional Private ap Placements Unitranche ’Story credit’ unitranche (mezzanine/PIK)Subordinated Growth capital Structured equity 1 2 3 4 5 6 7 There islimited a number of Alternative Lenders operating to L+600bps in pricing the L+450bps territory. A number of large funds are now actively raising capital to target this part of the market. Direct Lenders approach the mid-market with either a niche strategy (mainly new entrants) or a broad suite of Direct Lending products to cater for a range of needs. financing The latter is mostly the approach of large asset managers. We haveWe identified seven distinctive private debt strategies in the mid 1 4 3 2 Deloitte Alternative Lender Deal Tracker Spring2021 7 6 5 Debt size Debt Unitranche Mid-cap private placements Story credit unitranche Traditional senior debt carcit inancial ol tion o carcit inancial ol tion o Mezzanine Holdco PIK Growth capital Equity Structured
ote Di tre ed trate ie are e cl ded ro t i overvie Margin
What are the private debt strategies? debt private the are What Deloitte Alternative Lender Deal Tracker Spring 2021 | Insights into the European Alternative Lending market
How does the Direct Lending investment strategy compare to other strategies?
Target return Investment Preferred Carried Fund strategy Description (Gross IRR) period Fund term Management fee return interest
Invest directly into 5 ‑7 years Direct senior corporate credit at Typically around 1% on 5‑10% 1 ‑3 years (plus 1‑2 optional one 5%‑6 10% lending senior levels of the invested capital year extensions) capital structure
Opportunistic investments across the capital structure and/or Specialty 8 ‑10 years Typically 1.25 – 1.50% on in complex situations 15%‑ lending/credit 12 ‑20% 3 ‑5 years (plus 2‑3 optional one invested capital or less 6‑8% 20% opportunities year extensions) than 1% on commitments Typically focused on senior levels of the capital structure Insights into the European Alternative Lending market 1.50 – 1.75% on Primarily invest in 10 years commitments during mezzanine loans and Mezzanine 12 ‑18% 5 years (plus 2‑3 optional one investment period, 8% 20% other subordinated debt year extensions) on a reduced basis on instruments invested capital thereafter
Invest in distressed, Various pending target stressed and 7 ‑10 years return and strategy: undervalued securities Distressed 15 ‑25% 3 ‑5 years (plus 2‑3 optional one 1.50 – 1.75% on 8% 20% year extensions) commitments or 1.50% Includes distressed on invested capital debt ‑for‑control
Management fee – an annual payment made by the limited partners in the fund to the fund’s manager to cover the operational expenses.
Preferred return (also hurdle rate) – a minimum annual return that the limited partners are entitled to before the fund manager starts receiving carried interest.
Carried interest – a share of profits above the preferred return rate that the fund manager receives as compensation which is based on the performance of the investment.
44 © Deloitte Alternative Lender Deal Tracker Insights into the European Alternative Lending market Lending Alternative European the into Insights Deloitte Alternative Lender Deal Tracker Spring 2021 | Insights into the European Alternative Lending market
What debt structures are available in the market?
Structures TDA
enior de t ank
nitranc e nd
oldco
it
oldco
econd lien enior enior nitranc e L nitranc e de t de t L L L L to enior de t enior de t L L nlevered Levera ed tretc ed nitranc e i rcated nitranc e enior nitranc e oldco
Weighted Average Cost of Debt (WACD) – based on mid-point average range
ote T e tr ct re L + 50 350bps L + 450bps L + 575bps L + 700bps L + 700bps L + 815bps and ricin re ented are indicative and onl Pros and Cons per structure or ill trative r o e
Lo e t ricin ncrea ed ncrea ed tretc ed tretc ed tretc ed elation i levera e levera e levera e levera e levera e ank l o llet de t le i le le i le le i le relation i Lo er e it covenant covenant covenant • Lo levera e ank contri tion ne to o reater role Lo er e it • orter tenor ol tion or ank contri tion ear • ore re trictive • ore re trictive eed o eac ore o ntercreditor ter ter t an e ec tion li id art o • artl a orti in nitranc e elation i t e nitranc e • i er ricin • i er ricin lender arket t an ank de t • eed or • i er ricin • i er ricin lender • ntercreditor AAL
© Deloitte Alternative Lender Deal Tracker 45 Deloitte Alternative Lender Deal Tracker Spring 2021 | Insights into the European Alternative Lending market
More sponsor‑less companies are turning to Direct Lenders to finance growth
Background Opportunity Key advantages • Traditionally private companies • Alternative Lenders are actively looking Key advantages of using Alternative Lenders to fund a buy and build strategy may include: without access to further shareholder to form longer term partnerships with funding lacked the ability to make performing private companies to fund • Accelerate the growth of the company and transformational acquisitions expansion exponentially grow the shareholder value in a shorter time period.
• Bank lenders are typically not able • Recent market transactions have been • No separate equity raising required as to fund junior debt/quasi equity risk structured on Debt/EBITDA multiples Alternative Lenders can act as a one stop and would require a sizable equity as high as 4.5-5.0x including identifiable solution providing debt and minority contribution from the shareholders to hard synergies. Typically, this is subject to equity. fund acquisitions c.30–40% implied equity in the structure, • Significant capital that Alternative Lenders based on conservative enterprise can lend to a single company (€150-300m) • Cost savings, revenues synergies and making Alternative Lenders ideal for long valuations ability to purchase bolt on acquisitions term partnership relationships and follow on capital for multiple acquisitions.
Insights into the European Alternative Lending market at lower EBITDA multiples makes a buy • A number of Alternative Lenders are able and build strategy highly accretive for to fund across the capital structure from shareholder’s equity. senior debt through minority equity.
Sponsor backed versus private Direct Lending deals As % of total deals per quarter
e t o ro e e t o 12 17 13 14 15 20 16 18 19 17 13 14 15 18 19 16 17 13 14 15 18 19 16 20 20 17 13 15 14 18 19 16 20 LT
on or on or le
46 © Deloitte Alternative Lender Deal Tracker Insights into the European Alternative Lending market Lending Alternative European the into Insights Deloitte Alternative Lender Deal Tracker Spring 2021 | Insights into the European Alternative Lending market
Unlocking transformational acquisitions for privately owned companies
Indicative calculations • The calculations on this page illustrate the effect of value creation through acquisitions financed using Alternative Lenders.
• In this example the equity value is growing from €100m to €252m in 4 years time. Without the acquisition, the equity value would have been only €177m, using the same assumptions and disregarding any value creation as a result of multiple arbitrage.
Value creation through M&A Assumptions Indicative calculations • Both businesses te generate €10m te Ac i ition ndin te al e a ter ear e lt EBITDA with €2m potential er Tar et o ined o t a tr ct re a tr ct re deal ca a ter ear a ter ear synergies tr ct re it it o t al e ac i ition ac i ition creation • No debt currently d e to ner ie t tandin in the business de t arrant a ter ear • Cost of debt is 8% o additional with 5% penny val e creation warrants on top or e it older a a re lt o t e ac i ition • 10% EBITDA illion De t ndin growth pa; 75%
it Cash conversion; val e ro t 20% Corporate tax rate it ndin • No transaction costs TDA
Tar et nitranc e it arrant ner ie
i c and it c ca on alance eet rin t e e it val e to c
© Deloitte Alternative Lender Deal Tracker 47 Deloitte Alternative Lender Deal Tracker Spring 2021 | Insights into the European Alternative Lending market
Who are the Direct Lenders?
Note: offices included with at least one dedicated Direct Lending professional. The graph does not necessarily provide an overview of the geographical coverage.
United Kingdom Germany Poland France
Italy Insights into the European Alternative Lending market
Spain eciall oc ed on ro
Benelux
Nordics Portugal Ireland
Switzerland
48 © Deloitte Alternative Lender Deal Tracker Insights into the European Alternative Lending market Lending Alternative European the into Insights Deloitte Alternative Lender Deal Tracker Spring 2021 | Insights into the European Alternative Lending market
Note: offices included with at least one dedicated Direct Lending professional. The graph does not necessarily provide an overview of the geographical coverage.
United Kingdom Germany Poland France
Italy
Spain eciall oc ed on ro
Benelux
Nordics Portugal Ireland
Switzerland
© Deloitte Alternative Lender Deal Tracker 49 Deloitte Alternative Lender Deal Tracker Spring 2021 | Deloitte Debt and Capital Advisory
Deloitte Debt and Capital Advisory Deloitte Capital and Debt Advisory
50 © Deloitte Alternative Lender Deal Tracker Deloitte Debt and Capital Advisory Debt and Capital Deloitte Deloitte Alternative Lender Deal Tracker Spring 2021 | Deloitte Debt and Capital Advisory
What do we do for our clients?
Debt and Capital Advisory
Independent Global resources & Market leading Demonstrable advice execution expertise team track record
• We provide independent • A leading team of 200 debt • Widely recognised as a Global • In the last 12 months, advice to borrowers across professionals based in leader with one of the largest we have advised on over the full spectrum of debt 30 countries including Europe, Debt Advisory teams. 100 transactions with markets through our global North America, Africa and • We pride ourselves on our combined debt facilities in network. Asia, giving true global reach. innovative approach to excess of €10bn. • Completely independent from • Our expertise ranges from challenging transactions and • Our target market is debt providers of finance – our the provision of strategic the quality of client outcomes transactions ranging from objectives are fully aligned advice on the optimum we achieve, using our hands €25m up to €750m. with those of our clients. capital structure and available on approach. sources of finance through to the execution of raising debt.
Debt and Capital Services provided
Refinancing Acquisitions, Restructuring Treasury disposals, mergers or negotiating
• Maturing debt facilities. • Strategic acquisitions, • New money requirement. • Operations in multiple • Rapid growth and expansion. involving new lenders and • Real or potential breach of jurisdictions and currencies • Accessing new debt markets. greater complexity. covenants. creating FX exposures. • Recapitalisations facilitating • Staple debt packages to • Short term liquidity pressure • Develop FX, interest rate and payments to shareholders. maximise sale proceeds. • Credit rating downgrade. commodity risk management • Asset based finance to • Additional finance required • Existing lenders transfer strategies. release value from balance as a result of a change in debt to an Alternative Lender • Cash in multiple companies, sheet. strategic objectives. group. accounts, countries and • Off balance sheet finance. • FX impacts that need to be • Derivatives in place and/or currencies. • Assessing multiple proposals reflected in the covenant banks hedging requirements • Hedging implementation or from lenders. definitions. to be met. banks hedging requirements • Foreign currency denominated to be met. debt or operations in multiple currencies.
Depth and breadth of expertise in a variety of situations
© Deloitte Alternative Lender Deal Tracker 51 Deloitte Alternative Lender Deal Tracker Spring 2021 | Deloitte Debt and Capital Advisory
Global Deloitte Debt and Capital Advisory One of the most successful Debt and Capital Advisory teams
UK Partners
Chris Skinner Phil Adam James Blastland John Gregson Anil Gupta Partner, Head UK Debt Partner Partner Partner Partner & Capital Advisory +44 (0) 20 7007 0308 +44 (0) 20 7303 7502 +44 (0) 20 7007 1545 +44 (0) 113 292 1174
Deloitte Capital and Debt Advisory +44 (0) 20 7303 7937 [email protected] [email protected] [email protected] [email protected] [email protected]
UK Team
Mark Beckett Robert Connold Andrew Cruickshank Alex Dugay Paolo Esposito Director Director Director Director Director +44 (0) 20 7303 7849 +44 (0) 20 7007 0479 +44 (0) 20 7007 0522 +44 (0) 20 7007 9593 +44 (0) 20 7007 8964 [email protected] [email protected] [email protected] [email protected] [email protected]
Steve Mowll Henry Pearson Carl Sharman Adam Sookia Priya Veerapen Director Director Director Director Director +44 (0) 20 7303 4099 +44 (0) 20 7303 2596 +44 (0) 20 7007 7128 +44 (0) 113 292 1927 +44 (0) 20 7007 7339 [email protected] [email protected] [email protected] [email protected] [email protected]
Helen Dunmore Lucy Fall Tao Foo Will Garrett Ben James Assistant Director Assistant Director Assistant Director Assistant Director Assistant Director +44 (0) 113 292 1871 +44 (0) 20 7007 2472 +44 (0) 20 3741 2135 +44 (0) 20 7007 1847 +44 (0) 20 7303 2467 [email protected] [email protected] [email protected] [email protected] [email protected]
Shefali Prakash Holly Rainford Svenja Schumacher Alex Skeaping Carl Stevenson Assistant Director Assistant Director Assistant Director Assistant Director Assistant Director +44 (0) 20 7007 5826 +44 (0) 161 455 6497 +44 (0) 20 7007 9363 +44 (0) 20 7007 7881 +44 (0) 20 7007 7672 [email protected] [email protected] [email protected] [email protected] [email protected]
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Karlien Porre Nick Soper Partner Partner +44 (0) 20 7303 5153 +44 (0) 20 7007 7509 [email protected] [email protected]
George Fieldhouse Zoe Harris Louise Harvey Roger Lamont Jamie Mehmood Director Director Director Director Director +44 (0) 20 7007 2612 +44 (0) 20 7007 9723 +44 (0) 20 7303 3476 +44 (0) 20 7007 7731 +44 (0) 20 7007 7818 [email protected]. uk [email protected] [email protected] [email protected] [email protected]
Adam Worraker Naeem Alam Tom Birkett Agathe Boutonnet Jack Chaplin Director Assistant Director Assistant Director Assistant Director Assistant Director +44 (0) 20 7303 8347 +44 (0) 20 7007 3655 +44 (0) 20 7007 9758 +44 20 7303 2153 +44 (0) 20 7007 2436 [email protected] [email protected] [email protected] [email protected] [email protected]
Michael Keetley Anu Kuppa Alice De Lovinfosse Ikaros Matsoukas John Pardoe Assistant Director Assistant Director Assistant Director Assistant Director Assistant Director +44 (0) 20 7303 0384 +44 20 7007 1254 +44 (0) 20 7007 6220 +44 (0) 20 7303 5841 +44 (0) 20 7007 4154 [email protected] [email protected] [email protected] [email protected] [email protected]
Allen West Sam White Luka Bankovich Louis-Ferdinand Bravard Megan de Jager Assistant Director Assistant Director Manager Manager Manager +44 (0) 20 7303 0997 +44 (0) 113 292 1224 +44 (0) 20 7007 7480 +44 (0) 20 3741 2742 +44 (0) 20 7007 5914 [email protected] [email protected] [email protected] [email protected] [email protected]
© Deloitte Alternative Lender Deal Tracker 53 Deloitte Alternative Lender Deal Tracker Spring 2021 | Deloitte Debt and Capital Advisory
UK Team
Will Durgan Hamish Elsey Anni Gibson Varun Goel Ankush Gupta Manager Manager Manager Manager Manager +44 (0) 20 7007 1618 +44 (0) 20 7303 5916 +44 (0) 20 7303 0153 +44 (0) 78 8100 8460 +44 (0) 20 7303 2330 [email protected] [email protected] [email protected] [email protected] [email protected]
Nada El-Kordie Mishka Lalla Tyler Lovas Shazad Khan Ernesto Martínez
Deloitte Capital and Debt Advisory Manager Manager Manager Manager Manager 44 20 7007 2055 +44 (0) 20 7007 0061 +44 (0) 20 7303 2092 +44 (0) 20 3741 2051 +44 (0) 20 7007 2724 [email protected] [email protected] [email protected] [email protected] [email protected]
June Shi Tom Spellins Tom Tarrant Goutham Panthulu Joe Tipton Manager Manager Manager Manager Manager +44 (0) 20 7007 5195 +44 (0) 20 7007 1774 +44 (0) 20 7007 6247 +44 (0) 20 7303 7636 +44 (0) 20 7303 0428 [email protected] [email protected] [email protected] [email protected] [email protected]
Lynn Li Lucien Nzotarh Edward Rushworth Angus Jones Salar Vaziri Assistant Manager Assistant Manager Assistant Manager Associate Associate +44 (0) 161 455 6569 +44 (0) 1224 84 7438 +44 (0) 20 7007 6438 +44 20 7303 6369 +44 20 7303 6425 [email protected] [email protected] [email protected] [email protected] [email protected]
Deloitte UK/US Joint Venture
David Flemming Senior Vice President +1 (212) 313 1908 [email protected]
54 © Deloitte Alternative Lender Deal Tracker Deloitte Debt and Capital Advisory Debt and Capital Deloitte Deloitte Alternative Lender Deal Tracker Spring 2021 | Deloitte Debt and Capital Advisory
Luke Harris Emily Harvey Manuel Hamel Wangyu Kim (Q) Hannah Kirkup Manager Manager Manager Manager Manager +44 (0) 20 7007 2344 +44 (0) 20 7303 4814 +41 58 279 6373 +44 (0) 20 7303 8248 +44 (0) 113 292 1564 [email protected] [email protected] [email protected] [email protected] [email protected]
Tim Mercorio Harry Nicholas Dimitris Pantermalis Philippa Raal Tomas Reto Manager Manager Manager Manager Manager +44 (0) 20 7665 1801 +44 (0) 20 7303 +44 (0) 20 7303 5047 +44 (0) 20 7007 3829 +44 (0) 1727 885221 [email protected] [email protected] [email protected] [email protected] [email protected]
Sam Adejumo Laura Baeardwood Tinu Fagbohun Aleks Jaunkains Shivan Joshi Assistant Manager Assistant Manager Assistant Manager Assistant Manager Assistant Manager +44 (0) 20 7007 8208 +44 (0) 20 7007 4741 +44 (0) 20 7007 9962 +44 (0) 20 7303 4680 +44 20 7007 4541 [email protected] [email protected] [email protected] [email protected] [email protected]
© Deloitte Alternative Lender Deal Tracker 55 Deloitte Alternative Lender Deal Tracker Spring 2021 | Deloitte Debt and Capital Advisory
Global senior team
Australia Austria Belgium Brazil Canada Chile China
Amber Faulkner-Shotter Thomas Lahmer Sebastiaan Preckler Reinaldo Grasson Andrew Luetchford Jaime Retamal Patrick Fung +61 (2) 9322 7702 +43 15 3700 2722 + 32 2 800 28 35 +55 11 5186 1763 +1 41 6601 5277 +56 22 729 8784 +852 2238 7400 afaulkner-shotter [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] @deloitte.com.au
Czech Republic Denmark France Germany Greece India Ireland Deloitte Capital and Debt Advisory
Radek Vignat Morten Husted Permin Olivier Magnin Axel Rink Ioannis Apostolakos Vishal Singh John Doddy +420 246 042 420 +45 61 55 26 70 +33 1 4088 2885 +49 (69) 75695 6443 +30 210 678 1348 +91 22 6185 5203 +353 141 72 594 [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected]
Israel Italy Japan Luxembourg Mexico Netherlands Norway
Joseph Bismuth Andrea Azzolini Haruhiko Yoshie Pierre Masset Jorge Schaar Alexander Olgers Andreas Enger +972 3 608 5554 +39 283 325 700 +81 80 443 51 383 +352 45145 2756 +52 55 5080 6392 +31 8 8288 6315 +47 23 279 534 [email protected] [email protected] haruhiko.yoshie [email protected] [email protected] [email protected] [email protected] @tohmatsu.co.jp
Poland Portugal Singapore South Africa Spain Switzerland Turkey
Michal Lubieniecki Antonio Julio Jorge Richmond Ang Brad Mc Dermott Aitor Zayas Peter Nobs Kivanc Cidam +48 22 5110 010 +351 210 422 524 +65 6216 3303 +27 (0) 83 307 3277 +34 911 578 945 +41 58 279 6065 +90 212 366 60 62 mlubieniecki [email protected] [email protected] brmcdermott [email protected] [email protected] [email protected] @deloittece.com @deloitte.co.za
UAE UK USA
Robin Butteriss Chris Skinner John Deering +971 4506 4857 +44 (0) 20 7303 7937 +1 70 4333 0574 [email protected] [email protected] [email protected]
56 © Deloitte Alternative Lender Deal Tracker Deloitte Debt and Capital Advisory 57 | D eloitte Debt and Capital Advisory © Deloitte Alternative Lender Deal Tracker Deloitte Alternative Lender Deal Tracker Spring2021 Deloitte Debt and Capital Advisory 58 Selected Global transactions Selected credentials Advisory Capital and Debt Deloitte 2021 Spring Tracker Deal Lender Alternative Deloitte UK UK Netherlands USA Jan 2021 Jan Feb 2021 Dec 2020 Dec 2020 Fortino Capital Partners Capital Fortino Acquisition Financing Acquisition Financing Acquisition Finance Acquisition Finance
Bridgepoint D.C © Deloitte Alternative Lender Deal Tracker acquiring
HGGC GHO U U U
ndisclosed ndisclosed ndisclosed
£
87m
UK Dec 2020 Dec UK UK UK Dec 2020 Jan 2021 Feb 2021 Northedge Capital Northedge Lender Education Bridgepoint D.C Refinancing Refinancing Halfords Refinance
Private
U U U ndisclosed ndisclosed ndisclosed
£ 180m
UK South Africa South Africa South Africa Feb 2021 Jan 2021 Jan Dec 2020 Dec 2020 eloitte Debt and Capital Advisory Capital and Debt eloitte Transfer Pricing of Debt Transfer Pricing of Debt | D Kerry Ingredients S.A. Ingredients Kerry Financial Model Build Apex Group Limited Group Apex Acquisition Finance Afgri Group Afgri
ABB
U U U ndisclosed ndisclosed ndisclosed
R
250k
Netherlands UK UK UK University ofUniversity Manchester Dec 2020 Dec 2020 2021 Jan 2021 Feb Phoenix Equity Partners Partners Equity Phoenix Additional Liquidity Additional Real Estate Finance Recapitalisation Kester Capital Kester Capital VP Capital VP Refinance
U U
ndisclosed ndisclosed
£ 250m €
18m
Ireland Netherlands UK UK Dec 2020 Dec 2020 Jan 2021 Feb 2021 Landmarque Property Property Landmarque Amend & Restatement Acquisition Financing Group Limited Hg Mercury 3 Mercury Hg Fund Finance Refinancing
Polyscope Verastar
U U U U
ndisclosed ndisclosed ndisclosed ndisclosed
Universal Coal Universal and Energy Slovakia Italy South Africa UK Dec 2020 Dec Dec 2020 2021 Jan Jan 2021 Aquiline Capital Partn. Aquiline Capital Financial Model Build
Holdings S.A. Holdings Refinancing Infracapital Term Loan Term Refinance
Coop
U U ndisclosed ndisclosed
€
€ 130m 80m
Deloitte Debt and Capital Advisory 59 450k
R
ndisclosed ndisclosed ndisclosed
U U U
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Comair Financing
Refinancing Winterbrook Model ReviewModel Implementation Alt Capital Struc. Project Rocket II Sept 2020 Nov 2020 Nov 2020 Oct Oct 2020 Oct South AfricaSouth UK AfricaSouth Ireland Acquisition & Development Development & Acquisition 25m 115k
€ 200m R
£
| D
eloitte Debt and Capital Advisory
135m+$170m
£
Carlyle
Nestle S.A. Incremental Diploma PLC Maguar CapitalMaguar © Deloitte Alternative Lender Deal Tracker Acquisition financing Acquisition Acquisition Financing Acquisition Transfer Pricing of Debt of Pricing Transfer Sept 2020 Oct 2020 Nov 2020 Nov UK South AfricaSouth UK Oct 2020 UK
360m €
ndisclosed ndisclosed ndisclosed U U U
Hg CapitalHg
Refinancing Loopia Group Loopia Staple Financing Staple GEM Group Limited NAMA Refinance and Acquisition Financing Acquisition Development Financing Development Oct 2020 2020 Sept Nov 2020 Nov 2020 Oct Cosgrave Property Group Cosgrave UK Ireland Denmark Ireland
450k
R
ndisclosed ndisclosed ndisclosed Deloitte Alternative Lender Deal Tracker Spring2021 U U U
Refinance Batenburg Kooperasie Refinancing Sumo Group Sumo Die HumansdorpseDie Acquisition Financing Acquisition Financial Model Build Model Financial Aquiline CapitalAquiline Partn. Oct 2020 Oct Sept 2020 Nov 2020 Nov 2020 Oct South AfricaSouth UK Netherlands UK 375k 150m 200m
R
£
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Acqusition Kooperasie Infracapital Hg Trust plc Hg Genesis 9 Fund Finance Fund Fund Finance Fund Die HumansdorpseDie Financial Model Build Model Financial Sept 2020 Sept Oct 2020 Oct Nov 2020 Nov Nov 2020 South AfricaSouth UK UK UK
15m 555m £ 275m £ €
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CIBILS
Westcon Partners Refinance C-19 Amendment C-19 Confidential Acquisition Financing Acquisition Mountain Warehouse Mountain Investcorp Technology Investcorp Technology Nov 2020 Oct 2020 Oct Oct 2020 Oct Nov 2020 UK UK UK UK Deloitte Debt and Capital Advisory 60 Selected Global transactions Selected 2021 Spring Tracker Deal Lender Alternative Deloitte Norway UK UK UK Jul 2020 Jul 2020 Jul Jun 2020 Jun Sept 2020 Acquisition Financing Acquisition Financing Francisco Partners Berry Bros &Rudd Bros Berry Confidential Project Orchard Project Amend & Extend © Deloitte Alternative Lender Deal Tracker Camira Fabrics Era ABL Facility
U U ndisclosed ndisclosed £ £
52m 11m
Subscription line Financing UK AS Italy UK Jun 2020 UK Jul 2020 Jul Aug 2020 Jun 2020 X: Acquisition Financing Acquisition Financing UNV Confidential
Roberto Cavalli Roberto Project Lexus Project Term Loan Term
Horizon
Hg U U U ndisclosed
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10m UK Ndalamo Resource Pty Ltd Pty Resource Ndalamo UK South Africa South Africa Jun 2020 Jun 2020 Jul 2020 2020 Aug eloitte Debt and Capital Advisory Capital and Debt eloitte Era OCTO PRESENTATION I | D Debt Capacity Analysis To Distressed Financing Distressed N Cashflow Review for for Review Cashflow ny Confidential Confidential Liquidity Support Liquidity V
MTN Cameroon We Project Galaxy Project Project Kite Project E ber, A Debt Refi A Debt
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U O U U ndisclosed ndisclosed ndisclosed R
R
450k
PA
GE
UK France UK Accrol Group Holdings Plc Jun 2020 UK Jul 2020 Jul Aug 2020 Jun 2020 Jun Acquisition Financing LBO Financing Annual Report and Accounts 2018 Annual Report Refinancing
Livingbridge Refinancing
Matalan
Telenco
U ndisclosed
€
$ 105m £ 35m 26m
Belgium Italy Belgium Jun 2020 UK Aug 2020 Aug Jul 2020 VALUE INNOVATION, QUALITY, Jun 2020 Glide Partners Buyout Acquisition Financing Acquisition Financing
Term Loan Term C-19 Loan C-19
Inflexion
Galeria
Bitron
U U U ndisclosed ndisclosed ndisclosed
€ 80m
UK UK Netherlands UK Jun 2020 2020 Jul Aug 2020 Jun 2020 Jun Acquisition Financing Confidential Confidential Confidential Covid-19 support Covid-19 support
Monaco Norton
COV-19
Begra Birch U U ndisclosed ndisclosed
£ £ 800m 225m AlternativeDeloitte Debt Lender and Capital Deal Tracker Advisory Q1 2018 Data Introduction 61 500m
£
ndisclosed ndisclosed ndisclosed
U U U Hg
SNIB acquiring
Spring
Advisory
Refinance RVM Invest Refinancing Confidential Acquisition Finance Acquisition Project Rocket Apr 2020 Apr 2020 Mar May 2020 May Apr 2020 Belgium UK UK UK 550m
€
| D
eloitte Debt and Capital Advisory
ndisclosed ndisclosed ndisclosed U U U
CDC Violet
GifiTati
Hg Saturn 2
Fund Finance Fund Debt Advisory Debt Project Finance Amend & Extend & Amend Confidential © Deloitte Alternative Lender Deal Tracker May 2020 May Apr 2020 Apr 2020 Apr Mar 2020 Mar France UK UK France
m 250m £ C$20
ndisclosed
ndisclosed U U Hg
Prompt Bodycote
Senior Debt Senior Amend & Extend & Amend Growth Financing Incremental FacilityIncremental Travelwin Group DAC Apr 2020 Apr May 2020 Apr 2020 Apr UK Mar 2020 Mar UK Ireland Canada
50m 60m £ 200m £
C$
ndisclosed Deloitte Alternative Lender Deal Tracker Spring2021 U
Card
Espresso Wightfibre
Senior Debt Senior Refinancing CAPEX Financing Covid-19 support Covid-19 Confidential Gov of Switzerland May 2020 May Apr 2020 UK UK Mar 2020 Mar Apr 2020 Apr Canada CH/UK/GER
80m £ 100m £
ndisclosed ndisclosed U U
Best
Steel
Caspian Refinance Confidential Confidential Covid-19 support Covid-19 Confidential Covenant Amendment Covenant Transfer Pricing of Debt of Pricing Transfer May 2020 May 2020 May Apr 2020 South AfricaSouth UK Mar 2020 UK ABB SouthAfrica (PTY) Ltd UK
180m 320m £ £
ndisclosed ndisclosed U U
Felton
Windsor
Valentine Amend & Extend & Amend Covid-19 support Covid-19 Confidential Confidential Castelmore Group Acquisition Financing Acquisition Acquisition Financing Acquisition Mar 2020 Mar Apr 2020 May 2020 May Jun 2020 Jun UK UK Belgium Netherlands Deloitte Alternative Lender Deal Tracker Spring 2021 | Notes
Notes
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