French boutique Axiom Alternative Investments (Axiom) has announced the completion of the initial public offering of Axiom European Financial Debt Fund Limited (AEFD).
The company will invest in a diversified portfolio of regulatory capital securities issued by European financial institutions.
A placing of ordinary shares to raise gross proceeds of £50.73m (€71.75m) at an issue price of 100 pence per share has been made.
Trading is expected to begin today on the specialist fund market of the London Stock Exchange.
AEFD is structured as a closed-ended investment company registered in Guernsey, with a continuation vote after seven years. As investment manager of AEFD, Axiom will look for investment opportunities linked to the Basel III and Solvency II transitions in Europe.
AEFD mainly invests in the secondary market with possibilities to subscribe to instruments in the primary market where Axiom identifies attractive opportunities.
Axiom has developed its focus on the subordinated debt market over the past six years. The company has been managing a separate account using AEFD’s proposed strategy since 1 January 2015. At end August, this account delivered gross returns of 12.91% per annum.
AEFD aims to target a net total return on invested capital in excess of 10% per annum over a seven year period.
David Benamou, managing partner of Axiom, said: “We are pleased to announce the successful admission to trading of Axiom European Financial Debt Fund on the Specialist Fund Market today. We have had a very positive reception from cornerstone investors who share our view that the time is perfect to launch the fund now that there is greater stability in the eurozone.
“The ongoing changes in European financial regulation continue to provide a compelling investment opportunity in higher-yielding debt securities, and we look forward to AEFD growing through an ongoing placing programme once the fund has developed a solid performance track record.”