Securing yield through long-term lending partnerships.
The European Direct Lending strategy aims to consistently outperform for our investors by lending to attractive, growing businesses on terms seeking capital preservation and yield capture.
Head of Private Debt and CLOs
Focused on quality
Access to the stable, low-correlated returns offered by senior-secured loans to middle-market businesses in the UK and Europe.
European SME focus
Flexibility to invest across Europe combined with co-lending agreements with partner banks.
A strong pan-European reach combined with co-lending agreements with partner banks, provides a consistent flow of high-quality investment opportunities.
Experience throughout cycles
The team has an average of 16 years’ experience per member and can successfully structure, execute, monitor and restructure loans.
The coupon payments of senior-secured bonds move in sync with interest rates, preserving value in inflationary periods and providing a base return when rates are low.
Banks continue to withdraw from the business-lending market, enabling direct lenders to partner with mid-market businesses – a shift supported by European governments.
The Hermes Direct Lending cycle
Target Return:EURIBOR plus 5-6% gross annualised
Universe:Senior loans to European mid-market businesses − European loans: 65%-100% − UK loans: 0%-35%
Eligible instruments:Senior-secured loans: 65%-100% of portfolio, Unitranche loans: 0%-35% of portfolio
Targeted leverage:Leverage below 5.5x for senior-secured loans/6.5x on unitranche loans
Fees: Management fee: 75bps, Performance fee: 10% of returns exceeding EURIBOR +3.5% net per annum, compounded annually
Base currency:Euros, with limited hedge on foreign currency exposure
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Head of Private Debt and CLOs
Patrick joined Hermes in June 2015 to launch and manage the Hermes Direct Lending Strategy, which invests in senior loans to UK and European mid-market businesses. He was previously Head of Direct Lending in London at Tikehau Capital, and Partner at WCAS Fraser Sullivan Investment Management, where he established the firm’s European loan business. Prior to that, Patrick managed loan portfolios in excess of $4bn and $10bn as managing director at the Lehman Brothers Estate and head of European and Asian loan portfolio management and restructuring at Lehman Brothers respectively. He has a Bachelor of Commerce in Business Administration and French from the University of Edinburgh.
Head of Direct Lending
Laura joined Hermes in November 2015, when the private debt platform was being established. Her role has developed from analysing potential fund investments into a multi-faceted role, which includes managing the Direct Lending team, as well as analysing potential fund investments. Laura joined from GE Capital, where she was an associate in its mid-market leveraged finance execution team. At GE, Laura focused on arranging financings for European private equity-backed acquisitions funded through senior, second lien, mezzanine and unitranche facilities. Prior to this, Laura worked for three years at Bank of Tokyo-Mitsubishi in its acquisition finance team in London, focusing on opportunities in European large-cap leveraged finance transactions and on portfolio management. Her previous role was at Allied Irish Bank in Dublin in its Corporate Banking North America division, in which she analysed US large-cap and middle-market leveraged finance transactions, and performed portfolio management functions. Laura has an Economics degree from University College Dublin. She is a CFA charterholder.