Investment & Fund Management

The European Investment Fund (EIF) has committed €20 million as an anchor investor to the SG Capital Baltic Private Credit Fund, managed by Latvia-based SG Capital Partners AIFP. This fund is specifically designed to address the financing challenges faced by small and medium-sized enterprises (SMEs) and small mid-caps in the Baltic region, particularly in Estonia, Latvia, and Lithuania. The initiative aims to raise a total of €100 million from a diverse pool of institutional investors to support businesses that struggle to secure adequate bank lending.

The tailored solution provided by the SG Capital Baltic Private Credit Fund includes senior financing options such as loans and bonds, which are intended to assist SMEs with acquisitions, capital expenditures, and working capital needs. This approach is particularly crucial for companies that require flexible and timely financing solutions, especially when traditional bank financing is not accessible. The fund is classified as an Article 8 fund under the Sustainable Finance Disclosure Regulation (SFDR), with a commitment to allocate 15% of its investments towards climate action and environmental sustainability.

The expected outcomes of this initiative are significant, as it not only aims to bridge a critical funding gap for SMEs in the Baltics but also fosters economic growth and innovation in the region. The EIF's investment is seen as a strong endorsement of the potential within the Baltic market and the capabilities of SG Capital, which has a mission to support sustainable and impactful investments. The fund anticipates its first closing in April 2025, marking a pivotal step in enhancing the financing landscape for businesses in the region.