Six months after its launch, the investment trust has formally announced its plan to increase assets under management.
RM Secured Direct Lending will seek to place an undisclosed number of new shares at a 3.8 per cent premium to it net asset value, according to the firm's investment manager.
The fund launched back in December 2016 having raised £50.6m but, as its manager James Robson recently told AltFi, ample opportunities for capital deployment have brought in the opportunity for new money to be put to work.
Robson says the RM team sees ‘an attractive pipeline of investment opportunities’, particularly with the on going volatility in markets owing to the unfolding drama and volatility of Brexit and Trump.
RM Secured Direct Lending targets the SME lending space investing in loans it originates of between £2-10m, specialising in secured debt investments.
RM announced it expected to achieve the dividend target of 4 per cent pa on the IPO price in year one, rising to 6.5 per cent for the year to December 2018.
At 30 April, the fund had committed £54.8m to 17 loans with an average yield of 7.65 per cent and an average life of 3.6 years. The commitments were 76 per cent to fixed rate loans, 18 per cent floating rate and 6 per cent in inflation linked loans. Loans include exposure to UK residential property bridge finance, domestic boiler finance, student accommodation, a large UK /European forecourt operator, and the behavioural healthcare sector.
The fund charges fees at 0.5 per cent of net assets, although this increases to 0.875 per cent if net assets are above £75m. In the first three years, half of the management fee will be paid in shares.
AltFi is returning to Amsterdam for its second annual Summit in the city. The inaugural event last year was a roaring success, with key figures from across Continental Europe's alternative finance and digital banking sectors highlighted. These included Jeroen Broekema, managing director of Funding Circle Netherlands, and Mieke van Engelen, head of innovative partnerships at ABN AMRO's standalone lending platform, New10.