ESB’s pension scheme is understood to have backed DunPort Capital Management’s new €283m fund as the alternative lender attempts to capitalise on an ongoing credit crunch afflicting SMEs.
The Dublin-based firm yesterday announced a first close on its inaugural Elm Corporate Credit vehicle, which intends to target businesses with revenues in excess of €5m, and confirmed it had secured funds from a handful of domestic institutions.
According to sources, ESB’s pension scheme, which is separate from the State company itself and is overseen by trustees, is a backer. It previously backed the €450m BlueBay Ireland Corporate Credit I (BICC) vehicle, raised in 2013 that was led by the team now involved in DunPort.
BICC was one of three funds backed in 2013 by the Ireland Strategic Investment Fund (ISIF) to provide financing to SMEs. Last year however, BlueBay opted not to raise a second Irish credit fund and drafted in the freshly-established DunPort to act as an adviser to the existing fund, which matures in 2021.
Aside from DunPort’s support from BICC’s backers, the new firm is well placed to refinance deals from the 23 borrowers in the BlueBay portfolio.
DunPort’s executives are hoping to carve out a substantial foothold in its wake. Its co-founders Pat Walsh and Ross Morrow are expected to raise a second, larger, credit vehicle if the funds from the first are deployed within three years.
Mr Walsh said: “As a locally owned, managed and funded non-bank credit platform, we look forward to continuing our strong relationship with our institutional investors and our network of intermediaries and advisers to continue to provide alternative debt capital to Irish SMEs and mid-sized corporates.”