TIKEHAU DIRECT LENDING

The proposed operation consists of an equity participation of up to EUR 75m in Tikehau Direct Lending IV, a EUR 1.6bn fund containing two compartments (levered and unlevered) and several separately managed accounts. The EIB would invest in the unlevered sub-fund only. This non-diversified mid-market loan fund will adopt a non-granular strategy and a generalist approach in terms of sectors, targeting private debt investments in European small and medium-sized enterprises (SMEs) and mid-caps. Given its target size (above EUR 500m) and its expected average size of the underlying investments (above EUR 25m), this transaction falls within the remit of EIB. This operation will be proposed under the European Fund for Strategic Investments (EFSI).

The Fund's strategy intends to provide mid-market enterprises (SMEs and mid-caps) primarily based in the European Union (mainly France, Spain, Italy, Benelux or the UK) with tailor-made debt financing solutions. The financing extended consist of private bespoke and non-granular corporate financing, mainly in the form of first lien debt instruments (predominantly unitranche and stretched senior debt).

The Fund will be required to develop an environmental & social policy and establish the appropriate management systems so as to comply with the environmental and social requirements of the Bank. The assessment of the environmental and social impacts and risks will be part of the standard due diligence process that the Fund will have to carry out for each underlying investment, thereby ensuring that the portfolio and these investments are in compliance with national law, EU environmental legislation as well as the EIB Environmental and Social Standards (inside the EU) and in compliance with national law and in line with the principles and standards of relevant EU environmental legislation as well as the EIB Environmental and Social Standards (outside the EU).

For investments located inside the EU, the Fund has been assessed by EIB as investing only in private companies not being subject to EU rules on public procurement or concessions. For investments located outside EU, the Fund has been assessed by the EIB as investing only in private companies not operating in the utilities and not having a status of contracting entity, and not being concessionaire. The Bank will require the Fund Manager to take all the requisite measures to ensure that contracts for the implementation of the projects financed by the Fund follow fair and transparent procurement procedures and satisfy the criteria of economy and efficiency.