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Candriam, Kartesia
Candriam, a global multi-asset manager focused on sustainable investing with about €149 billion ($154 billion) assets under management, together with Kartesia, a European specialist investment manager focused on private capital solutions, has just launched a joint Luxembourg European Long-Term Investment Fund (ELTIF).

The fund will target private debt opportunities across the European lower mid-market (LMM) landscape, supporting local European economies and providing investment access for private and retail investors, the firms said in a statement.

Following the completion of the necessary filing, the fund is expected to become available in Austria, Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Portugal, Spain and Sweden.

The fund will offer exposure to the European LMM, where there is a pool of companies with limited financing options compared with larger markets, with a diversified loan portfolio across sectors and geographies and integrating a sustainable approach.

The strategy combines the private and liquid credit management expertise of Kartesia and Candriam, both of which are part of New York Life Investment Management (NYLIM). It will benefit from Candriam’s fund management capabilities and distribution network combined with Kartesia’s specialism in the LMM space and local approach, the firm continued.

The fund comprises two buckets: a liquid short-term corporate credit and money market bucket representing 15 per cent of the fund and managed by Candriam, and an illiquid component of 85 per cent private credit complementary strategies focused on cash-flow generative businesses with growth potential, as well as seeking robust risk-adjusted returns and downside protection managed by Kartesia.

As such, the fund provides a flexible solution with a semi-liquid product offering, low entry ticket, and streamlined investment. It also benefits from the potential diversification effects offered by private credit loans, offering a relatively low volatility and low correlation to traditional asset classes.

"Retail investors have struggled to access private markets, but ELTIF 2.0 changes that. In the current interest rate environment, with banks lending less money, there is a clear opportunity in the lower mid-market private debt in Europe,” Renato Guerriero (pictured), deputy CEO, chief sales and distribution officer at Candriam, said.

“The launch of ELTIFS dedicated to private debt is crucial to the aim of increasing access for a broader range of investors to this established yet growing asset class,” Charles-Henri Clappier, partner, head of KSO France and business development at Kartesia, added.