FINANCE - FUNDS

Private debt

Linking long-term investments with the real economy



Francesco Battazzi, head of diversified debt funds at the European Investment Fund speaks about private debt at the upcoming Alfi PE & RE conference. Photo credit: EIF

Francesco Battazzi, head of diversified debt funds at the European Investment Fund speaks about private debt at the upcoming Alfi PE & RE conference. Photo credit: EIF

The Association of the Luxembourg Fund Industry holds its Private Equity and Real Estate Conference 30 November-1 December 2021.

In advance of the summit, Delano spoke with Francesco Battazzi, head of diversified debt funds at the European Investment Fund. He speaks on the “Private debt – opportunities and challenges” panel, Tuesday 30 November at 2:20pm.

Aaron Grunwald: What do you want the audience to get most from the private debt session? 

Francesco Battazzi: I expect to cover senior lending provided by debt funds to SME and mid-market companies in Europe. I hope that the insights from leading market players will provide key takeaways to the audience, particularly on the importance of private debt as a way to link long-term investments with the real economy and as a useful instrument to direct such investments towards common long-term goals like sustainable development and innovation.

Is the pandemic still having a significant impact on private debt markets?

The private debt market was able to weather the storm of the covid-19 pandemic. Investors’ allocations to private debt have actually gained popularity during the pandemic, and direct lending activity has gradually and boldly reemerged in 2021. On the other hand, fundraising for smaller funds and new teams has been and still remains challenging.

How do you except the European private debt sector will evolve in 2022?

While volumes will continue to be driven by large asset allocations to a few larger private debt players, I expect investment diversification needs will contribute to increased interest for local players and niche strategies, particularly those focused on granular SME portfolios. In addition, the growing focus on the policy targets of environmental and social sustainability will put pressure on the debt fund industry to focus more on impact investment and to be more transparent about their contributions to ESG goals.

Aside from your own talk, which session are you most looking forward to hearing, and why?

I expect “Raising capital for sustainable private assets” [editor’s note: Wednesday 1 December at 11:40am] to be a particularly interesting session, because this is expected to be the main market trend going forward.

The European Investment Fund is on Linkedin