>@Nadine HENRY/EIB

The Normandy Region’s investment fund Normandie Participations, the European Investment Bank (EIB) and two Caisses Régionales du Crédit Agricole (Crédit Agricole Regional Banks - CRCA) have set up a new financing instrument for businesses in Normandy: the “Normandie Horizon” participating loan fund with a financing capacity at first close of EUR 20 million, which will then be increased to EUR 40 million.

The Memorandum of Intent was signed in Rouen today by President of the Normandy Region Hervé Morin, EIB Vice-President Ambroise Fayolle, Chairman of Normandie Participations Franck Murray, CEO of Caisse Régionale du Crédit Agricole Normandie-Seine Nicolas Denis, CEO of Caisse Régionale Crédit Agricole Normandie Daniel Epron and Chairman of Sofimac Régions’s Management Board Pascal Voulton.

Bringing together equity investment and a long-term loan, Normandie Horizon will increase the finance available to businesses in Normandy. It objective is to offer a simple and effective financial tool to support SMEs and mid-caps that are finding it difficult to obtain standard loans, mainly due to a lack of equity, while upholding the independence and governance structures of these enterprises.

Around 75 companies will be able to benefit from this participating finance until 2022, and on attractive financing terms thanks to the involvement of the EIB, which enjoys a triple-A credit rating, and the EU guarantee under the Investment Plan for Europe (commonly known as the Juncker Plan).

President of the Normandy Region Hervé Morin stated: “Normandy is the only region to have set up this type of financial instrument, as we were also the first to create our own financing fund Normandie Participations. The participatory funds from Normandie Horizon will generate the necessary leverage to obtain standard loans. This approach contributes to the region’s dynamism: all our economic indicators are currently on the rise, clearly exceeding the national average. We are now among the leaders in terms of job creation and growth in company turnovers.”

EIB Vice-President Ambroise Fayolle said: “Thanks to this innovative financing solution, we are in a position to provide companies in Normandy with optimum support for their development projects. This is precisely the added value of the involvement of the EIB, the EU bank, and the Juncker Plan in the heart of the regions! By innovating and developing new financial instruments with our partners, we can meet the requirements of entrepreneurs and project promoters more closely. I would like see other participating loan funds being developed in other French regions”.

Chairman of Sofimac IM Pascal Voulton added: “We are very pleased to be playing a part in Normandie Horizon. This large-scale project is built on an ambitious vision, shared by all the stakeholders, of stimulating the economic fabric of SMEs and mid-caps in Normandy with a range of flexible and sustainable tools where private equity and long-term loans come together.”

Normandie Horizon’s support brings real value added to the Norman beneficiary company:

  • it boosts the equity of the company while generating a leverage effect on its bank debt;
  • it is not dilutive for the manager and may include a component with a bullet repayment structure;
  • it reduces guarantees backed by the company’s assets.

Normandie Horizon, operational since June 2018

Normandie Participations, the EIB and Crédit Agricole have joined forces to launch Normandie Horizon, a participating loan fund with an envelope of EUR 20 million at first close, which is expected to increase rapidly to EUR 40 million.

With this new facility, the EU, the Normandy Region and Crédit Agricole are combining their efforts to introduce a simple, effective and flexible instrument for Norman businesses that is capable of addressing the region's whole economic fabric – from micro-enterprises to mid-caps.

A starting budget of EUR 20 million...

Normandie Horizon’s initial capital is made up of EUR 7 million from Normandie Participations and EUR 3 million from two Caisses Régionales du Crédit Agricole, together with EUR 10 million from the EIB, resulting in an immediate financing capacity of EUR 20 million.

The fund’s resources may then be increased up to EUR 40 million. In addition, the EIB has approved a loan of up to EUR 20 million.