AshGrove Capital’s €650M Fund II is a game changer in European private credit

AshGrove Capital, an independent pan-European specialty lender, has announced the close of a  €650 million Fund II, surpassing its target of €500 million. 

This milestone reflects a more than 100 per cent increase in fund size compared to AshGrove’s €300 million inaugural fund, making it the only independent European performing private credit fund to achieve such growth in recent years, according to Preqin data. 

AshGrove was founded five years ago and operates below the radar of traditional European direct lenders, working with both sponsors and founders. It specialises in lending €10-50 million of senior secured debt capital to businesses with robust business models and a high proportion of recurring revenues.

Fund II has already committed approximately 20 per cent of its capital across five investments, with a robust pipeline of further opportunities.

AshGrove’s first fund, which held a final close at €300 million in late 2021, is performing ahead of expectations and has already delivered several strong realisations. This first fund is benchmarking within the top 5 per cent of European senior debt funds according to Burgiss benchmarking.

The Firm focuses on senior secured investments in companies with resilient business models within B2B software and services, integrating ESG principles and values in all aspects of its business, promoting responsible and sustainable business practices.

Fund II achieved a 107 per cent re-up rate among existing limited partners and secured over €325 million in new capital commitments.

Over 40 per cent of Fund II capital comes from US-based investors, and its investor base includes pension funds, endowments and foundations, insurance companies, family offices and fund of funds.

Phil Fretwell, co-founder and Partner at AshGrove, attributes the Firm’s success to skills and determination:

“When we established the Firm, we saw a structural opportunity in the European lending market to back small and medium-sized companies with resilient, non-cyclical business models within B2B software and services. 

We believe access to credit should not be a function of business size, but the quality of the business model.”