Assisted Search: Private Debt – LMPD051023v-Deadline Thursday 2nd November 2023

A UK Investment Consultant is using CAMRADATA to run a search for Lower Mid-Market Private Debt funds. The consultant will be looking to select new managers in the new year. All funds being proposed must be listed in CAMRADATA Live and returns must be up to date i.e. to 30 June 2023.

If you would like to put a fund, or a number of funds, forward for this search, then you must, in the first instance, contact CAMRADATA with the name of the fund that you would like to propose.

Please note: WE NO LONGER ACCEPT QUESTIONS OVER EMAIL. Please post any questions regarding this search onto the CAMRADATA Live ‘Assisted Searches Forum’ and we will endeavour to answer these as quickly as possible.

Assisted searches are run on behalf of institutional investors with specific search requirements.

Asset ClassPrivate Debt
DeadlineThursday 2nd November 
Market FocusLower mid-market funds, with a predominant investment (>70%) in senior secured debt. The balance may be invested in junior or equity-related debt.
CurrencyGBP / GBP Hedged
Geographical FocusWe favour funds with a diversified geographical investment strategy.
Management Experience We place a high value on management teams with over 15 years’ experience in the lower mid-market/SME debt domain. Their track record should be impeccable.
BenchmarkIRR > 12%
Performance MarketTarget IRR should be greater than 12% 
Mandate SizeAllocation size from their clients will vary depending on the size of the client. Will range from £500k to £10 million.
Length of FundThe term should be less than 11 years, including extensions, with an investment period under 4 years, inclusive of extensions.
OwnershipStaff majority ownership is essential, with a minimum 2% investment commitment in the fund by the General Partners to ensure alignment of interests.
Loan CharacteristicsPreference for loans that will amortise during the tenure of the facility.Maximum permissible senior and total leverage post-deal should be 4.5x (Net Debt/EBITDA).Time to net positive yield: < 3 years.
Cash Yield> 5%.
Portfolio Company CriteriaCompanies should possess strong reporting mechanisms to ensure deal monitoring until repayment.
DiversificationA strategy that ensures no more than 30% allocation to any single industry and no single investment exceeding 10-15% of the total fund
ExclusionsInvestments should not be made in businesses primarily dealing with:Real estateFinancial servicesTobacco manufacturing and related productsGamblingPornographyWeapons and armaments manufacturingAny activity that is illegal or considered “sin-type”
Management & GovernanceSpecialist and experienced teamDemonstrable track recordA strategy that emphasises sustainability and repeatabilityStrategy size in line with market potentialNiche strategies that larger, more generalist funds can’t easily tap into ​​​​​High standard of governance
Alignment and ESGThe fund should be ESG compliant and have mechanisms in place to maximize value for investors.

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