The complexity premium is the additional return available on capital solutions investments relative to traditional lending. While it can be difficult to disentangle from credit risk and other risk premia, we define it as where nuance in the asset, business, process or structure limits conventional lender participation, creating the opportunity to earn a premium return relative to a situation with similar credit risk but without the nuance.

Below we spotlight this “Complexity Premium”, which we believe is particularly apparent across Hayfin Tactical Solutions corporate primary investments.

In our view, complexity typically arises in one of three ways:

Traditional lenders can be constrained from lending into these situations due to:

Each constraint removes competitors – resulting in either a higher return for credit risk (comparable to a traditional transaction), or disproportionate compensation for a modest increase in risk. Pricing is therefore driven by the scarcity of capable capital rather than solely by a marginal recalibration of credit risk. The comparison below shows new primary issuance in the European broadly syndicated loan and direct lending markets versus the Hayfin Tactical Solutions (“HTS”) strategy over the past two years*.

Source: Weighted average margin. European Direct Lending and HTS Q2 2024–2025

HTS investment pricing exceeds both the broadly syndicated market and direct lending, with the majority of the returns derived from cash-pay components supplemented by PIK. While leverage levels are incrementally higher on average, HTS has achieved a more attractive spread per turn of leverage, alongside higher upfront fees, supporting the view that returns are driven by complexity and capital scarcity rather than leverage alone.

Source: Hayfin. As at Q2 2025

Complexity must be understood to be sufficiently managed

The durability of the complexity premium depends on the ability to assess and manage risk effectively. We believe three capabilities are central to this, and are fundamental to how we evaluate, structure and execute investments in multifaceted situations:

Case Study: Corporate Primary Lending

One of the defining characteristics of HTS is that its primary lending can earn a complexity premium without purely taking additional credit or documentation risk versus a traditional lender.

An example of this is a senior secured term loan Hayfin provided to support a take-private transaction. The public-to-private nature of the transaction meant the sponsor could engage only a limited number of financing counterparties, and whilst it had support from traditional bank lenders, there was a financing gap.

Hayfin was able to bridge this gap by providing longer-dated capital that remained structurally pari passu whilst benefiting from premium economics that included incremental loan margin and upfront fees, as well as call protection. These economics compensated Hayfin for the structuring and execution required to help facilitate the transaction for the sponsor, rather than for a weaker position in the capital structure.

This transaction highlights how HTS generates a premium by providing tailored capital solutions and executing in situations where complexity constrains traditional lenders.

Hayfin’s Tactical Solutions strategy is focused on generating a return premium in excess of traditional lending strategies by tactically allocating to investments and market segments that we believe can produce attractive returns while maintaining a conservative risk profile. The broad mandate of the strategy includes both primary and secondary lending transactions as well as asset ownership, and spans the corporate, asset-backed and securitised products markets.

For more on Hayfin’s Tactical Solutions strategy, visit hayfin.com/strategies/private-credit/tactical-solution.

* As of 31 December 2025.

Reflects new primary lending deals from 2024-2025 and excludes add on financings. Past performance is not a guarantee of future results. All investments involve risk, including possible loss of principal. See “Notes to Investment Performance” for more information on past performance, expected returns and the impact of fees on returns to investors. The investment strategy and commitments made by HTS differ from the strategy and composition of ELLI. Additionally, there are inherent limitations to the comparison of the performance of HTS and Direct Lending with the above referenced indices. ELLI represents Morningstar European Leveraged Loan Index, a market-value weighted multi-currency index designed to measure the performance of the European leveraged loan market.

Hayfin has led, as sole lender, the debt financing to support a new financing arrangement for Condis Supermercats (“Condis”), the leading proximity supermarket group in Catalonia. The funding will be provided through a €305m senior-secured unitranche facility, backed by the company’s institutional shareholder Portobello Capital (“Portobello”).

Condis is the leading proximity supermarket group in Catalonia, recognised for its convenience-led format, dense urban footprint and strong local brand. The supermarket group was founded in 1961 and is headquartered in Montcada i Reixàc, near Barcelona. Today, it operates more than 700 supermarkets, combining owned stores and franchises across Catalonia, with a main focus on the Barcelona city area, under the Condis and Condis Express brands.

The transaction was led by the Condis management team, backed by Portobello, and positions the company for its next phase of growth under continued sponsor and management ownership. The terms of the transaction have not been disclosed.

Manel Romero, CEO of Condis, said: “This transaction marks an important milestone for Condis, following our team’s work over many years to build a strong, locally-rooted business with a clear identity, convenient shopping proposition and a deep commitment to the communities we serve. With the support of Hayfin and Portobello alongside our management team, we are well positioned to accelerate our growth while preserving the values that define us. We look forward to beginning this new chapter.”

Juan Luis Ramírez, Partner at Portobello Capital, said: “We are delighted to support Condis as it continues to build on its strong track record of operational excellence. The team there have a clear strategy for long-term expansion, and this transaction highlights our continued commitment to that ambition, which has underpinned the company’s success since our entry in 2021. We look forward to continuing to work with Manel and the broader team on this exciting next phase of growth.”

Pepe Trasobares, Principal at Hayfin, said: “Condis has established a leading position in the Catalan grocery market through a strong brand, a differentiated, proximity-led model and its extensive local footprint. We’ve always been impressed by the team’s vision since our first interaction in 2019, and we’re delighted to provide this financing and support Condis as it continues to succeed.

The transaction also reflects Hayfin’s long-standing commitment to Spain, where our origination team has been on the ground for over a decade, investing more than €2.5bn of capital to date with high-quality businesses in the region.”

Hayfin is pleased to announce that it acted as sole lender in the refinancing of Norvestor-backed Serwent, a Norway-based provider of underground infrastructure maintenance (UIM) services.

Serwent provides recurring, non-discretionary traditional pipe and relining services underpinned by periodical maintenance requirements. The company serves a diverse range of customers across end-markets in the public and private sectors in Norway, Sweden and Denmark. Serwent is well-entrenched in the regional UIM market, which is poised for continued expansion with tailwinds from an ageing infrastructure stack and a tightening regulatory backdrop.

The transaction strengthens Serwent’s position on the back of its acquisition of Swoosh, and provides meaningful capacity to support its consolidation of a fragmented market.

Marco Ferrari, Managing Director, Private Credit, Hayfin Capital Management commented: “Serwent is a Nordic market leader in a resilient niche, with a competitive moat cemented in scale and regional density. We are delighted to partner with Norvestor as well as Aleksander, Fredrik and the Serwent team – supporting its expansion in Sweden with the acquisition of Swoosh and throughout the next chapter of its growth journey. The transaction reflects sustained momentum for Hayfin in the Nordics, where we continue to see a strong pipeline of opportunities for our Direct Lending strategy.”

Payment-in-kind is one of the most scrutinised features in private credit today – and one of the most misunderstood. The labels we reach for don’t always tell the full story.

The market has settled on a familiar shorthand for thinking about payment-in-kind (PIK). “Good PIK” is the PIK agreed at entry, a deliberately structured feature of the deal, priced and protected from day one. “Bad PIK” is the PIK that arrives later, typically through an amendment, when a borrower can no longer service cash interest and the lender agrees to capitalise it instead.

It is language you will hear across the industry, and as a first cut it holds up: PIK a lender chose to underwrite is generally healthier than PIK a lender was forced into. One mechanical distinction is worth drawing up front: structured PIK capitalises interest by design from day one, while a PIK toggle is an option to switch from cash to PIK on defined terms – and either form can be good or bad, so what follows applies to both.

But the shorthand misses something.

Anchoring the distinction on when the PIK was agreed assumes that origin determines outcome: that good beginnings produce good endings. They do not always, and that gap opens up a category the two-way split has no name for: PIK that was agreed at the onset, and so looks like good PIK, but was never really value-covered. Call it “Fake Good PIK”.

A PIK feature’s origin tells you how it started; it says nothing about whether the position stays covered, or whether value is slowly migrating from lender to borrower over the life of the hold. So, we are really assessing three PIKs, not two – good, bad, and fake good – and two positions can sit under the same “good” label yet end up in opposite places. Two scenarios a direct lender might face, and approach differently, show why.

Scenario one – the disciplined originator 

THE SETUP

A direct lender originates a transaction with a PIK toggle built in from the outset. Crucially, the feature comes with adequate protections: the toggle can only be exercised in defined circumstances, PIK usage is capped (to a % of margin, ie there is a minimum cash pay) and time-limited in the documentation, and, importantly, any PIK is charged at a premium to the cash margin. PIK is expensive by design, which keeps the borrower honest about when they use it.

The company performs strongly throughout the hold. Some way into the investment, management identifies an attractive bolt-on acquisition and comes to us with a plan: they intend to toggle to PIK for a predefined period, at the agreed premium, to preserve cash while they integrate the target and capture synergies. Then they expect to return to cash pay.

We are comfortable with this. Our position remains well value-covered, the PIK is limited in both size, scope and duration by the documentation we negotiated, and we are being paid a premium for the flexibility we are extending. This is a healthy business using a tool we deliberately built into the structure to fund growth on sensible terms, not a borrower in distress reaching for oxygen. In due course, the company delivers on the integration, switches back to fully cash pay, and the position resolves itself cleanly.

VERDICT

Good PIK – and it earns the label. Agreed at entry, tightly protected, priced at a premium, used briefly by a performing business, and fully value-covered throughout. The structure did exactly what it was designed to do.

Scenario two – the stretch that never grew into itself  

THE SETUP

A lender originates a deal that requires a PIK component from day one. The PIK is not funding a specific, time-boxed use of cash; the borrower simply wants to stretch leverage without generating the cash to service it today. The thesis rests on future growth: the company expects to grow into the capital structure, and the PIK is meant to bridge the gap until it does.

On the surface, this is “good PIK” by the standard definition – it was agreed at the onset, not bolted on later through an amendment. But the label flatters it. The growth never materialises. Rather than being a temporary feature that switches off once cash flow arrives, the PIK simply keeps running.

The balance compounds, quarter after quarter, and the PIK creeps up. And it makes little difference here whether the PIK was structured in from day one or a toggle the borrower had to trigger once the growth case slipped: the mechanism differs, but the outcome – a compounding balance that cash flow never catches up with – is the same.

The problem isn’t the mechanism itself, but what it conceals. Because cash is never generated, the lender’s return becomes increasingly back-ended: more and more of the expected value sits in a growing accrued balance that only gets realised at exit or refinancing, and only if the enterprise value is there to support it.

Every quarter of missed growth widens the gap between the notional return on paper and the cash the position has actually produced. A feature designed to bridge to growth has instead become a way of deferring the recognition that growth is not coming.

VERDICT

Bad PIK – despite ticking the “agreed at entry” box. It started clean. That didn’t save it: value has shifted into an accruing balance whose recovery depends on a growth story that never delivered.

Why the labels only get you so far

Set the two side by side.

Scenario one was agreed at entry and is genuinely positive. Scenario two was also agreed at entry, and is not.

The “good PIK / bad PIK” framing, anchored on when the PIK was agreed, misses the questions that actually matter: Is the position value-covered? Is the PIK time-limited and capped, or open-ended? Is it being paid at a premium that keeps the borrower disciplined? And is it funding a specific, self-liquidating need, or substituting for cash the business was always going to struggle to produce?

Categorising PIK is a helpful exercise, and we do it. But the labels are a starting point, not a substitute for judgement. The characteristics of each situation – coverage, protections, pricing, purpose and trajectory – are what determine whether PIK is working for the lender or against it.

At Hayfin, we address PIK usage carefully and try to get ahead of it where it matters most: at origination.

Underwriting discipline is key, we assess fundamental cashflow generation and look critically at the sustainability of capital structures taking into account potential PIK accretion. The right protections – caps, minimum cash pay, time limits, premium pricing and clearly defined toggle conditions – are far easier to secure when you are structuring a deal than to retrofit once a position is stressed. Done well, PIK is not something to be feared. It can be an effective tool to optimise performance in situations where our debt position is value-covered, allowing good businesses to fund growth without over-burdening cash flow.

So, good, bad, or fake good PIK?

As is so often the case in private credit, the honest answer is: it depends – on the structure you negotiated, the coverage you hold, and the discipline you bring to both. The label on the tin is the least interesting part.

Hayfin today announces the successful close of Hayfin Direct Lending Fund V (“DLF V”), having attracted capital in excess of €15 billion, significantly exceeding its target for the fundraise. The fundraise comprises the commingled Hayfin Direct Lending Fund V, which has reached a final close, together with related investment vehicles. At the time of the close, DLF V had already deployed more than 50% of commitments across over 35 companies. 

Through its Direct Lending strategy, Hayfin sources, structures and invests in performing senior‑secured loans to primarily European middle‑market and upper‑middle‑market businesses, with an emphasis on downside protection and robust cash flow generation or asset coverage. The vast majority of these loans are originated through an extensive relationship-based primary sourcing network spanning 13 offices and dedicated sector‑specialist teams. This broad-based origination model has allowed Hayfin to build a diverse portfolio of loans to a wide range of cash‑generative businesses, with minimal exposure to software credits deemed most susceptible to AI disruption. Hayfin invested a record €7.1 billion into Direct Lending transactions in the last twelve months, bringing total strategy deployment to over €38 billion across more than 350 investments since the firm’s inception. 

The fundraise attracted capital commitments exclusively from a global institutional investor base, comprising public and private pension funds, financial institutions, insurance companies, sovereign wealth funds, funds of funds, endowments, consultants and family offices. Recent strains within semi-liquid US private credit funds for retail investors have accelerated LP demand for conservative fund structures, in line with Hayfin’s approach of securing locked-up capital in closed-ended drawdown and institutional evergreen vehicles. This helped Hayfin to achieve the most significant milestone yet for its flagship private credit strategy with the successful close of Direct Lending Fund V, more than doubling the amount raised for Direct Lending Fund IV, which closed in August 2023 with over €6bn in total commitments.  

The DLF V fundraise also includes the successful close of a rated note feeder which contributed approximately $600 million of total investable capital. The structure, advised on by Proskauer as Legal Counsel, provides insurers with capital-efficient access to Hayfin’s European Direct Lending strategy, reflecting the firm’s commitment to broadening access to its private credit platform across a diverse range of institutional investor types. 

Mark Tognolini, Co-Chief Executive Officer and Co‑Founder of Hayfin, commented: “We are very pleased with the successful close of Direct Lending Fund V and grateful for the strong support from both new and long‑standing investors. At a time when parts of the private credit market are experiencing heightened volatility, this fundraise reflects confidence in our disciplined underwriting, our highly specialised team, our conservative approach to fund structuring and our differentiated origination model, which has been built to perform consistently across market cycles. 

“In recent months, longstanding differences between the US and European private credit markets have become even more pronounced, with European lenders continuing to benefit from greater market fragmentation, continued bank retrenchment and a predominantly institutional capital base. Against this backdrop, we are well placed to take further market share and support high‑quality European businesses with flexible financing solutions – as we have consistently done in other periods of volatility – while preserving our focus on capital preservation and downside protection.” 

Hayfin was advised on the fundraise by Macfarlanes. 

Since it was founded in 2009, Hayfin has invested over €55bn of capital across more than 500 portfolio companies via its private credit strategies. 

Hayfin has fully underwritten the debt financing to support the acquisition of Hyve Group (“Hyve”), a leading next-generation B2B events business, by Hellman & Friedman (“H&F”). H&F is acquiring Hyve from Providence Equity Partners (“Providence”) and Searchlight Capital Partners (“Searchlight”), marking the next phase of Hyve’s growth and evolution.

The senior-secured facility extends an existing lending relationship with Hyve. Hayfin first invested in the business in 2021 and then again in 2023 when supporting its take-private by Providence and Searchlight. Since then, Hyve has delivered three consecutive years of double-digit organic revenue growth, expanded EBITDA beyond $100m and built out its platform through seven strategic acquisitions and five key event launches, while investing significantly in technology and tech-enabled products and services. In partnership with H&F, Hyve will focus on accelerating international launches, expanding adjacent products and services and continuing to scale into growing end markets via its proven acquisition strategy.

Founded in 1991 and headquartered in London, Hyve operates a global portfolio of premium, must-attend B2B events connecting some of the world’s leading companies, investors, innovators and decision-makers. It operates across high growth sectors such as healthcare, ecommerce, edtech, supply chain and martech, with flagship events including HLTH, Shoptalk, Bett, Mining Indaba and Fintech Meetup. Under its current leadership team, Hyve has positioned itself as a partner platform of choice for ecosystem events in high growth markets, with a customer offering spanning content, intelligence, matchmaking and membership.

Stuart Mitchell, Director at Hayfin said: “Having first invested in Hyve in 2021, including in its most recent ownership by Providence and Searchlight, Hayfin has developed a deep understanding of the business and its exceptional growth record. During this period, Hyve has transformed into a more global, diversified and digitally sophisticated platform, with strong momentum behind it. We look forward to working with Mark and his talented team as they enter this exciting next phase of the company’s development in partnership with H&F.”

Rehan Jiwani, Managing Director at Hayfin said: “We have been lenders in the B2B events space for more than 15 years and we have on-going strong conviction in the attractiveness of the sector. Hyve is an example of an exceptionally strong platform within B2B events, and we are excited to support the company with this latest, large-scale, financing. From a Hayfin perspective, it highlights our ability to provide sizeable financing solutions that support sponsors and management teams in executing their growth ambitions.”

Completion of the transaction is expected by the end of the calendar year.

Last month, we welcomed over 90 investors, partners, and colleagues to 10 Grand Central for what turned out to be a truly memorable day. The world had intervened in the weeks before in a way that gave every conversation an urgency and an honesty that can be hard to manufacture in a well-rehearsed agenda.

But the event really started the evening before when we hosted a dinner for a group of our limited partners – a deliberately smaller, less structured setting than what was to follow. No presentations, no panels. Just conversation. We wanted to hear directly from investors: what was on their minds, what was worrying them, what they needed from us that we weren’t yet delivering. The conversations that evening were candid in a way that only happens when there’s no agenda. They shaped the morning that followed, with three themes – portfolio transparency, views on AI disruption across our own portfolios, and the durability of European private credit – resurfacing in a more structured form throughout the day.

Our co-CEO Mark Tognolini opened the day and has written here about what’s been at the forefront of his mind in the opening months of the year. Let me give you a sense of what emerged – not panel by panel, but as the through-lines I kept coming back to across a genuinely substantive day.

The second-order effects are the underpriced story

After an opening session on the shifting macroeconomic environment, Jeff Currie picked up the threads from Andrew Sheets’ earlier framing and set out a clear way to think about commodities: physical markets clear today’s supply and demand, while financial markets price the future. The gap between the two – Brent at $120 in the physical market versus the low 80s in futures markets at the time – was not a rounding error. Markets were pricing a rapid resolution that did not square with the physical reality of bringing supply back on line; closed wells take months or years to reopen, not days.

What struck me wasn’t the headline oil disruption—that story was everywhere—but the second-order effects that rarely make the front pages. Nino Mowinckel walked through the specifics: over half of global seaborne sulphur trade transits the Strait of Hormuz, putting copper and nickel production at risk. Indonesia, the world’s largest nickel producer, imports around 75% of its sulphur from the Persian Gulf. Around a fifth of global refined copper output depends on sulphuric acid, while 24% of global fertiliser supply remained stuck behind the Strait. The inflationary impact may not show up until the second half, long after the headlines move on.

“The edge in European private markets is not price or leverage; it is the compounding advantage of being present in the right relationships for long enough that complexity becomes a differentiator, not a deterrent.”

Jeff Currie, formerly at Goldman Sachs and now running Energy Pathways at Carlyle, put a structural lens on it: the world that prioritised affordability and environmental credentials above energy security has been forced to reorder its priorities.  His broader rotation thesis – from asset-light to asset-heavy, the “HALO” trade – felt less like an acronym and more like a description of what we have been quietly building for over a decade.

Complexity is a feature of our market, not a problem – if you’ve built for it

The edge in European private markets is not price or leverage; it is the compounding advantage of being present in the right relationships for long enough that complexity becomes a differentiator, not a deterrent.

40% of our Direct Lending book is originated through sole lender deals; the rest are typically clubs of two to three lenders. Stephen Badia’s argument was that European private credit still looks far more like an extension of banking than a convergence with the syndicated market, and that inefficiency can be both a structural return driver and risk mitigant. Rehan Jiwani quantified it: a clear premium available in Europe versus comparable US credits – alongside lower leverage, tighter documentation and smaller syndicates that preserve genuine lender control.

Healthcare, Maritime and Real Estate showed the same dynamic in specialist form. Andrew Merrill made the case that our platform generates continuous opportunities to finance a company across its lifecycle and that even transactions we have declined can build an edge in the future. Over several years, the Healthcare team reviewed three plasma product businesses across the EU and the US, which for various reasons did not result in an investment; instead, it set the stage for a future successful investment in the space.   Hayfin underwrote an FDA-inspected plasma manufacturing plant that was still loss-making as it restarted post-shutdown – conviction built through years of accumulated diligence.  

Hayfin’s Greenheart Management, our wholly owned ship management subsidiary, is the Maritime equivalent. There we have operational directors tracking fuel consumption per knot across every vessel. That operational credibility is what earns 5–20-year contracts from investment-grade counterparties. Duration requires trust, and trust is built through cycles, not just sharp terms on the day.

As punctuated by Carlos Colomer, within real estate markets, the difference between partnering and not often comes down to local presence and cultural nuance. We understand how an owner thinks about control, how they weigh optionality, and how they want a structure explained. We meet people where they are—literally and figuratively—and communicate terms in a way that feels natural and precise. In relationship-driven markets, that is not a detail.

The private credit stress is real, but the systemic risk framing is wrong

The “Private Credit at a Crossroads” panel met the questions LPs are rightly asking. The backdrop is tough – the weakest quarter for direct lending fundraising in three years; BDCs trading at a discount to NAV – and the panel didn’t pretend otherwise.

Carlos Pla drew a key line: the semi-liquid vehicles under the spotlight are roughly a quarter of a now $2 trillion+ global private credit market, with average leverage around 1.2x – figures that were dwarfed by the embedded risks that defined the pre-GFC banking market. The other three-quarters of assets sit in closed-end funds, structures built for patient, disciplined deployment designed to take advantage when others pull back. Our €7 billion of undrawn capital is the practical expression of that design.

Michaela Campbell pushed back on defaults as the headline metric: they are backward-looking, inconsistently defined across managers and often deferred through amendments. The better litmus is in leading indicators – interest coverage trajectories, PIK toggle usage, watchlist trends and amendment volumes. On those measures, Hayfin’s Direct Lending portfolio looks considerably healthier than the headlines. The watchlist has fallen by almost a third since YE-2023; weighted average interest coverage ratios remain stable across consecutive quarters; and the vast majority of interest remains cash-paid.

On AI disruption, our underwriting framework extends well beyond software. As Mark Bickerstaffe put it, every sector we lend into is subject to the same question: what are the second-order effects if AI changes the economics of the profession or sector this business serves? We take a “guilty until proven innocent” approach to each company’s resilience to AI risk. There are no clean answers yet – which argues for caution in exposed sectors, not urgency. Marc Chowrimootoo made a related point on fraud: the headline cases have been non-sponsored, inventory-backed trades, and fraud is not a private credit phenomenon so much as a human one. The discipline is screening bad actors before you lend, including walking away when terms look good, but the governance does not.

“The illiquidity in private markets is an opportunity, not just a problem.”

The afternoon session on illiquidity could have been a sobering inventory – significant inventory of legacy assets seeking an exit and average hold periods stretching out fund terms. Instead, it showed how flexible, patient capital, in the form of either credit or equity, can step in where the market has no ready solution. The toolkit across private markets is broader than many assume: dividend recaps, bridge-to-IPO financing, continuation vehicle support, minority stake buyouts and management-led buyouts of the sponsor itself.

Sponsors are increasingly reluctant to sell their best assets — and our Private Equity Solutions Strategy is built around that reality. As Vladimir Balchev put it, the priority is less about DPI than TVPI: sponsors want solutions that extend hold periods and build value, not just accelerate distributions. In the small and mid-cap segment especially, the constraint is not liquidity for star assets – it is time and growth capital. GP-led transactions are now a core tool for addressing both, not a last resort.

A consistent origination edge permeated the discussion: relationships built over years, portfolios mapped 12 to 18 months before a transaction and credibility earned through repeat execution. For many mid-market sponsors, the choice is simple: they back partners who have been in the room before, not those who show up only when the process starts.

On listening

In closing, Tim Flynn left the audience with a simple wish: that if investors take one thing away from Hayfin, it is that the firm is built to deliver client outcomes regardless of where we are in the cycle.

Tim’s framing connected directly to how the day had started, and to the dinner the evening before. We are deliberate about listening, creating an environment in which investors can tell us what they need, rather than simply what we had come prepared to tell them. That commitment is what made the panels as honest as they were about the challenges facing the asset class. Honesty of that kind is either native to a culture, or it isn’t. You cannot manufacture it for an investor day and quietly retire it on the way home.

Thank you again to everyone who joined us in New York. Your continued partnership genuinely matters to us.

Hayfin has secured initial capital commitments to support the growth of its European CLO business, as part of a broader initiative to deepen its European alternative credit capabilities and scale the Hayfin platform.

Hayfin has a long and established track record in European CLOs, currently managing €5.8 billion in assets across 14 transactions, following the completion of four successful resets in 2025. These latest capital commitments will support continued growth in the platform by providing equity for future European CLOs issued and managed by Hayfin.

As part of this renewed strategic focus on its core European investing businesses, Hayfin has decided to appoint Greensledge as an advisor to explore options for its US CLO business, which represents €1.4 billion of assets under management. The US CLO platform has historically performed strongly, supported by disciplined underwriting and rigorous credit processes, and the firm is committed to an orderly process that protects the interests of noteholders and other investors.

Mark Tognolini, Co-Founder & Co-CEO of Hayfin Capital Management, said: “We are excited to announce this latest capital raise which supports the continued growth of our European platform, particularly in light of the significant opportunity we see as an established player within European liquid credit. With a strong team and experienced leadership in place, we are confident in our ability to execute with discipline and a continued focus on clients.

“The US CLO team has a strong historical track record and we are committed to ensuring continuity for investors throughout this process. We will work closely with the team and Greensledge to identify the best outcome for all stakeholders.”

When preparing to host Hayfin’s North American clients at our annual US AGM in New York last month, we knew three topics would be at the forefront of their thinking: software, retail redemptions and the Iran conflict. The discussion became a timely test of how private credit managers can demonstrate that they are the right partners to help investors navigate market volatility.

New AI models have triggered a repricing of business durability in the face of accelerating disruption, prompting LPs to examine their GPs’ exposure to potential losses in software, where private credit is often seen as heavily concentrated. At the same time, a surge in redemptions and gating in some US semi-liquid private credit vehicles has forced price discovery and raised the prospect of supply shocks. Finally, despite the fragile ceasefire reached in April, tensions in the Middle East continue to ripple through supply chains, commodities pricing and energy markets.

These three trends are playing out differently on either side of the Atlantic. In the case of the first two, the impact should in theory be more muted in Europe. Software is a smaller part of European lending than in the US, where it accounts for an estimated 20–25% of private credit activity. In Europe, higher-risk ARR lending to pre-profit software businesses with unclear paths to deleveraging is far less prevalent. Similarly, while retail capital has grown to 20–25% of global private credit AUM, withdrawals have been concentrated in US Business Development Company (BDC) and interval fund structures rather than in European vehicles, which are still relatively nascent.

But Europe is unquestionably more exposed to geopolitical risk – at least from the specific perspective of disruptions to energy supply and the resulting increase in inflation.

Is your money safe?

In all three cases, the first question that LPs should be asking their private credit managers is how they will preserve capital, protect value and limit downside risk within their existing portfolios.

We have previously explained why we remain underweight software across both our Private Credit and High-Yield & Syndicated Loans businesses. Our software exposure across Direct Lending portfolios is less than 6%, and below 5% in our latest vintage, which compares favourably with peers.

We have managed that exposure through prudent portfolio diversification and a clear view that software is not only potentially vulnerable to generative AI disruption, but also one of the most competitive parts of the market. Where we are invested, those loans are to large, mature, high-growth companies backed by sector specialist GPs. We have grounded our credit judgment in traditional credit metrics rather than uncertain enterprise value assumptions.

Uncertainty is not an environment we are waiting to pass. It is the environment we are built for.

We are similarly well placed on liquidity. Hayfin’s private credit strategies rely exclusively on fully locked-up institutional drawdown funds, with no retail capital. We had already been seeing growing demand for institutional vintage solutions that operate as drawdown vehicles, with redemptions achieved through natural portfolio run-off rather than forced asset sales. That trend now looks set to accelerate.

No manager, least of all one investing in Europe, can be fully insulated from the effects of conflict involving Iran. We saw during Covid and in the early stages of the war in Ukraine how shocks to energy, transport and agricultural supply chains can quickly spread through interconnected markets. Higher energy, fertiliser and freight costs would feed into food prices and create broader inflationary pressure.

Our dedicated Maritime team, with 15 industry specialists, more than $4 billion deployed and over 100 vessels acquired, gives us added insight into how global supply chains are being affected.

Where can managers create an edge?

The second question LPs should ask their GPs is how they are positioned to capitalise on these market dislocations. Throughout Hayfin’s history, periods like these have created the conditions for us to grow, gain market share, deepen relationships with borrowers and LPs, and deliver some of our best-performing investment vintages. Uncertainty is not an environment we are waiting to pass. It is the environment we are built for.

The obvious counterargument is that the private credit industry as a whole tends to gain market share from banks and syndicated markets during periods of disruption. The more important question, then, is what positions us to deliver compelling investment returns in a more uncertain environment relative to our competitors.

Our European focus is certainly an advantage. We consider ourselves the European home team, with 17 years of track record and a platform built to operate across fragmented jurisdictions, languages and legal regimes. The distinctive, longstanding opportunity set in Europe, as we have previously discussed, certainly still applies. There remains room for further growth, with the UK and EU’s combined GDP totaling 90% of the US, but with private markets just one third of the size. Additionally, as a shallower market than the US, Europe can reprice quicker in environments like this.

Hayfin’s adaptability and ‘one-firm’ culture, both of which I described earlier this year, are also well-suited for the current landscape. Our broad set of complementary strategies allows us to finance both growth and stress, and to lean into the parts of the market offering the best risk-adjusted returns, as this rapidly shifts around us. By operating in a de-siloed, integrated manner, when markets “flash amber”, we draw on the insights and experience of the whole team to re‑underwrite portfolios, reassess risks and recalibrate pipelines.

Recent market stresses will also affect future investment vintages. One potential second‑order effect of the recent strains in US private credit is that both LPs and borrowers will increasingly favour managers with more conservative approaches to fund structuring. US lenders might pull back from European markets, tipping competitive dynamics in favour of homegrown European managers with more institutional capital.

Patient capital – at scale

Many of the themes discussed here are only beginning to play out. We will remain patient, focusing first on supporting our existing borrowers as the market comes to us.

At the same time, we are preparing to invest selectively through our Tactical Solutions, Special Opportunities and Private Equity Solutions strategies. In these areas, choppier markets and a rising tide of €300 billion in net asset value without sponsor capital support are likely to drive demand for hybrid liquidity solutions.

With a significant undrawn capital position of c. €7bn today, we have the scale and firepower to capitalise on the opportunities that may present themselves in the months ahead.

Hayfin has led the debt financing to support an investment by Searchlight Capital Partners (“Searchlight”) in CloserStill Media (“CloserStill”), a leading B2B events platform with a portfolio of award-winning trade shows across four sectors. Searchlight and Providence Equity Partners (“Providence”) will have co-control of CloserStill, with Providence having the opportunity to re-invest in the company in order to support the company’s next phase of growth.

The senior-secured facility extends a longstanding lending relationship, after Hayfin first invested in CloserStill in 2018 when supporting its acquisition by Providence. Since then, CloserStill has invested significantly in its talent, capabilities and technology and grown fivefold, expanding from three to four verticals through a combination of organic growth, new event launches and targeted M&A.

Founded in 2008 and headquartered in London, CloserStill operates a market-leading portfolio of must-attend, award-winning B2B events across four high growth sectors: Technology, Healthcare, Learning & HR, and Future Transport & Infrastructure. Its flagship events include Ai4, the global Tech Show portfolio, the London Vet Show, Data Centre World, PTE World, Learning Technologies and The Dentistry Show.

Rehan Jiwani, Managing Director at Hayfin said: “With our longstanding relationship with CloserStill, dating back to our original investment in 2018, Hayfin is extremely well placed to continue supporting the business. Over the past eight years, CloserStill has delivered remarkable growth, scaling through a combination of organic expansion, new event launches and targeted M&A. We look forward to working with Gareth and his talented team as they enter this next phase of the company’s development.”

Stuart Mitchell, Director at Hayfin said: “Hayfin has worked with both Searchlight and Providence across multiple high-quality platforms in this sector and built deep experience as a leading investor in the B2B events space over more than 15 years. We are able to provide large‑scale financing solutions that support sponsors in executing their growth ambitions, and we are excited to build on these partnerships through our continued support of CloserStill.”

Gareth Bowhill, CEO at CloserStill Media said: “We are incredibly excited to embark on the next chapter of CloserStill’s evolution and are delighted that Hayfin will continue to be part of our journey. Since first investing in 2018, Hayfin has been a highly supportive partner to our business and our growth ambitions, and we have built a strong relationship together over that time. We look forward to continuing that partnership as we enter our next phase of growth.”

Completion of the transaction remains subject to customary regulatory approvals.