Real estate,
undisclosed

In mid-2005, Proventus provided acquisition financing to a listed real estate company in addition to its bank financing. The facility was based on a five-year structurally subordinated term loan of SEK 20 million. The borrower prepaid the loan in 2007 when the value of the real estate had increased sufficiently to support senior financing. The “loan to value” was higher than typically seen in this type of real estate projects (approximately 90 per cent), but justified by high cashflows and low risks of vacancies.

Proventus has in the past few years moved to meet what we believe to be an important, unfilled need among mid-sized European companies that are in expansion or restructuring, but are unable to acquire bank financing and unwilling to dilute current ownership to fund such initiatives. In August 2009, Proventus laid the ground for Proventus Capital Partners, a co-investment vehicle through which Proventus invests its own and external funds in public corporate bonds, leveraged loans and private corporate loans to mid-sized companies in need for growth and restructuring capital. We see this as a major investment opportunity, targeting capital needs that cannot currently be financed because of restrictive loan policies of banks and others. We think there is a significant need for a more active market of this kind and aim to take part in developing it.