LBP AM European Private Markets will soon launch its Sub-IG Infrastructure strategy

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As banks progressively withdraw from financing solutions rated below BB/BB-, new room is opening for specialised investors able to structure more flexible and better-yielding transactions. In a context of massive infrastructure needs — from the energy transition to digitalisation and essential service platforms — Sub-IG debt offers, in our view, both prospects for improved returns and defensive characteristics. A combination that, according to our analysis, may be particularly attractive for institutional investors. This shift is creating a strategic window: a deep mid-market segment, less targeted by the largest funds yet rich in solid projects and compelling valuations.

With over 13 years of experience and a track record of 75 completed transactions across all infrastructure sector, EPM is expanding its investment universe. “This Sub Investment Grade strategy is a natural extension of our current investment scope,” explains Bérénice Arbona.

The future Article 8-classified fund will target broad sector and geographic diversification across Europe, with 15 to 20 portfolio positions, leveraging the team’s ability to act as sole lender in many transactions and deliver tailored financing structures.

“There is a clear mid market segment to capture: some funds are now too large to focus on it, others too small,” adds Pierre-Emmanuel Giroux. The objective will be to deliver high single digit returns while upholding the platform’s high structuring standards — robust security packages, stringent covenants, enhanced due diligence — supported by strengthened teams already experienced in this segment.

A positioning designed to establish LBP AM as a leading player in Sub-IG Infrastructure debt across Europe.