March, EIB and Oquendo join forces to provide finance for SMEs

Integral service around a transaction
BY : Diego GutiérrezJanuary Fri, 2013

According to Europa Press, Banca Marchthe European Investment Fund and Oquendo Capital are jointly preparing the launch of a fund, with a fundraising target of EUR 100 million, to finance projects of small and medium-sized enterprises in Spain and Portugal.

Following the success of the first vehicle of this kind, which was backed by a EUR 50 million investment from Oquendo and is fully committed, the new fund, named Oquendo Mezzanine II, will provide alternative long-term financing and preferred equity to medium-sized companies in Spain and Portugal due to "the difficulties they face today in financing their projects"..

Specifically, the fund, which will begin operations early this year, will invest between 5 and 15 million euros per transaction, and expects around twelve investments over four years. Oquendo will provide long-term financing and preferred equity through a variety of flexible instruments.

Banca March has decided to participate in Oquendo Mezzanine II, after an exhaustive analysis and evaluation of the investment potential, and will therefore give its customers access to it through a conversion proposal, one of the bank's investment characteristics.

"The activity of Oquendo's funds as providers of alternative financing and their role as a catalyst for business growth have been fundamental factors for the incorporation of Banca March to the project", underlines the general manager of Oquendo's funds. Wealth Banking of the entity, Hugo Aramburu.

For its part, the European Investment Fund will contribute 33% of the capital, constituting "a benchmark investor and continuing in Spain its policy of supporting independent teams specialising in the financing of small and medium-sized enterprises. Thus, Richard Pelly, CEO of the EIF stated that "the aim is to support SMEs throughout their life cycle"..

For Alfonso Erhardt, one of the founding partners of Oquendo Capital, "it is very important to have the commitment of an entity such as Banca March, which has stood out in this crisis for having been very restrictive in its risk policy and for demonstrating its strength".

It should be noted that for the time being the remaining investors are institutional investors such as pension funds, insurance companies and other institutional investors. Soon, we will be able to see how these types of vehicles will be accessible to individual and smaller investors who are also looking for alternative opportunities to those offered by banks.

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