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09/01/2019

Santander creates 620 million euros fund to finance business growth

  • The bank makes the largest private debt fund in Spain available to companies that bill up to €100 million
  • The objective is to boost growth, sustainability, innovation, digitalisation and create jobs


Madrid, 9 January 2019 – Santander continues to consolidate itself as a responsible bank and a reference for SMEs and corporates and improves its financial and non-financial offer with a new fund, Fondo Smart, endowed with €620 million to provide loans to finance long term business growth. This new fund is the largest private debt fund in Spain and offers businesses a new financing alternative for projects that boost growth, sustainability, innovation, digitalisation and create jobs.

This new fund updates the Fondo Advance which was introduced in 2014 and offered €250 million in financing to SMEs mainly through ordinary debt. Fondo Advance was available for companies in business for more than three years with projects to invest in growth financing of one million euros or greater to be repaid over three years or more. Its reserves, however, have been depleted and it will now be replaced with a larger fund designed for a broader range of businesses.

The new Fondo Smart, is broken down into three lines depending on the development phase of the projects:

  • Fondo Smart Impulse is for the rapid expansion or post-start up phase. This €20 million fund is intended for companies with annual billing of up to three million euros, revenue that is growing exponentially and need a maximum of two million euros in financing for up to five years. The fund will invest in these companies, mainly via ordinary or subordinate debt, although other formulas are also envisioned such as convertible financing.
     
  • Fondo Smart Growth for the growth or SME phase. This is the evolution of the Fondo Advance fund and is expanded to €500 million. It is designed for companies with billing of between three and 100 million euros that register EBITDA growth and need financing for between €1 million and €15 million and a maximum ten year term. This instrument will be available via ordinary or convertible debt.
     
  • Fondo Smart Progress, for the consolidation or post-SME phase, this fund makes €100 million available for consolidated enterprises with annual billing of between €10 million and €100 million, profitable growth and need between €1million and €10 million over a ten year term. Financing will be provided to SMEs through ordinary or sub-ordinate debt.

The structure of the financing will be flexible and based on the needs of companies. The Fondo Smart will also allow companies to focus on sustainable growth, pursue high impact projects and take advantage of advisory services related to financial and non-financial solutions.

Rami Aboukhair, country head of Santander España, said: “With Fondo Smart we help fulfill our purpose as a responsible bank that helps businesses prosper and reinforce our long term relationship with clients. We accompany businesses as they grow and make strategic financing available to them to boost projects that support sustainable growth, innovation, digitalisation and generate employment”.

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