Merrill Lynch has divested a stake in Kreos Capital III, the 2006 vintage fund of Kreos Capital, a venture debt fund manager. The investment bank originally committed €150 million for the stake, but has now sold this position to investors.
“Despite challenging market conditions, Kreos and Merrill Lynch were able to successfully accomplish our strategic objective of diversifying Kreos III’s investor base,” says Roman Kogan, director at Merrill Lynch. “We are extremely pleased to be partnering alongside some of the world’s leading alternative asset investors. This transaction speaks volumes for the importance of venture debt as an asset class and for the expertise and professionalism of Kreos Capital.”
Merrill Lynch continues to be committed to the venture debt asset class and Kreos, and remains as the second largest single investor in Kreos III, with a 25% shareholding in the fund still.
Paul Capital, AIG PineStar Capital, HarbourVest Partners, Access Capital Partners and SVB Financial Group are the new investors in the fund.
“We are extremely pleased to have this opportunity to invest with Kreos,” says Guy Rico, partner at Paul Capital. “The team’s industry leadership and experience through cycles has allowed it to create a uniquely diversified, high-quality portfolio. Kreos is also well-positioned to capitalise on current market opportunities.”
“This investment further solidifies Kreos’s position as one of the premier venture debt providers outside the US,” says Raoul Stein, general partner at Kreos. “We have now assembled the strongest possible group of top-tier investors, to ensure a dynamic future for Kreos. This is a direct endorsement of Kreos’s team as well as of venture debt as a key component in the venture ecosystem in the UK and the rest of Europe, even during the current difficult market environment. We are delighted to have the continued support of Merrill Lynch, and that our new investors have shown this confidence in Kreos Capital, its venture capital partners and team. With our new long-term value-added capital base, we look forward to working with our new investors to build on our first 11 years of success.”
D.C.