Certior Capital has built up a diversified client base including European pension funds, insurance companies, endowments and family offices. Investors may choose to invest directly into our own dedicated funds or to use our experience in providing broader tailored mandates and advisory services which may include allocations to all parts of the European private equity and private credit universe including mid and large cap buyout and direct lending, special situation and venture capital opportunities. In total, our funds and mandates under management and our advisory mandates currently amount to around EUR 1bn.
“Investors may choose to invest directly into our own dedicated funds or to use our experience in providing broader tailored mandates and advisory services which may include allocations to all parts of the European private equity and private credit universe.”
We manage three separate series of funds which all share our differentiated approach to investing in private markets: investing in undercapitalised market sectors, seeding emerging managers and being a preferred co-investment partner.
| Certior Credit Opportunities Funds | Certior Special Opportunities Funds | Certior Private Equity Funds |
|
|---|---|---|---|
| Target return (net IRR) | 10–12% | 13–16% | 15–20% |
| Share of co-investments | 35–60% | ||
| Target instruments | Predominantly (>90%) loans | Flexible, hybrid approach | Predominantly (>90%) equity |
| Key investment considerations | • Value investments with asymmetric return profile • Recurring revenues • B2B businesses with mission critical services / products |
||
| Risk/return profile | • High current yield: 5–8% • Average holding period: 3 years • Limited equity upside: 3–5% pts • Strong downside protection • Fund life: 8–10 years | • Modest current yield: 3–5% • Average holding period: 4 years • Modest equity upside: c. 10% pts • Strong downside protection • Fund life: 8–10 years | • No to low current yield • Average holding period: 5 years • High equity upside: 15–20% pts • Modest downside protection • Fund life: 10–12 years |
| Preferred situations | • Cornerstone commitments • Emerging managers • Concept funds • Deal-by-deal managers • Existing manager relationships • Preferential co-investment access |
||
| Current best opportunities | • SME direct lending • Venture lending | • SME special situations • Small insolvency claims • Super-senior turnaround investments | • B2B service consolidation platforms • SaaS growth companies • Owner buyouts |
Certior Credit Opportunities Fund Ky concentrated on the SME direct lending opportunity across Europe, in particular, in Spain, the UK and Germany. While the majority of capital raised for private credit in Europe recently has targeted larger, private equity backed transactions, the lack of capital for country specific funds providing smaller unsponsored senior secured loans (typically EUR 5-25m) has led to the potential for very attractive risk-adjusted returns. The fund has cornerstoned a number of emerging managers in the sector in return for additional economic benefits and has used significant numbers of secondaries and co-investments to further reduce fees and increase the pace of investment. The fund raised EUR 87m in 2016 from a group of Finnish investors and has built a diversified portfolio of 7 primary, 1 secondary and 11 co-investments. It is on track to achieve its return expectations of 10%+ net IRR to investors from a portfolio of 100+ loans.
Certior Credit Opportunities Fund II SCSp again focused on the SME direct lending opportunity across Europe, especially in the UK, Germany, Ireland and the Benelux countries. It raised EUR 125m in 2020 from more than 25 European investors. At final closing the fund had already made commitments to a diversified portfolio of 5 primary, 1 secondary and 13 co-investments. The target return to investors is 10%+ net IRR from a portfolio of 100+ loans.
Certior Credit Opportunities Fund III SCSp held a first close in late 2021. It has the same investment strategy as its two successful predecessor funds and will focus on senior secured or asset backed loans to sponsorless small- and mid-sized companies in Europe. It will invest 50% through primaries (mostly cornerstone situations providing seed capital to new funds) and secondaries and 50% through co-investments. The target return to investors is 10%+ net IRR from a portfolio of 100+ loans.
Certior Special Opportunities Fund Ky was launched in November 2020 and invests in areas such as distressed debt, opportunistic strategies, special situations, non-performing loans and asset-backed securities. It focuses on investing in good quality companies and assets at below average pricing which offer deep value both in debt and, to a lesser extent, equity instruments and will focus on Europe. The fund is building a portfolio of 100+ assets through 5–7 primary fund investments (mostly smaller, high-conviction funds focusing on niche opportunities) and 10+ co-investments. It seeks to produce net returns of 13–16% IRR in line with leading special situation and distressed funds at significantly lower risk, given the diverse nature of the underlying portfolio.
Certior Private Equity Fund I Ky held a final closing in early 2020. The fund is building up a high conviction portfolio of investments in SPVs and concept funds as well as co-investments providing access to niche European private equity opportunities. It is targeting returns above 15% net IRR to investors.
Certior Credit Investments Ky was closed in 2015 and focused on co-investments in mid-market direct lending opportunities in Europe alongside leading private equity sponsors.
Tailored mandates
An institution may also choose to access our expertise and deaflow in other ways. For example, over a number of years we have worked with one of Europe’s most prestigious private wealth managers to source and analyse high quality private equity opportunities for its clientele. We have also set up tailored mandates according to the specific needs of a number of our larger institutional clients. For instance, we are working with a leading Nordic pension fund to manage their private equity and private credit portfolio which has to date made over EUR 200m of commitments. In another such mandate we manage the private credit portfolio of a high-profile Nordic pension fund with a particular emphasis on ESG matters. Increasingly, we are also in a position to offer co-investment and secondary opportunities that we have generated through our own network to other institutions on an ad-hoc basis.
