Clearwater surveyed 125 lenders across Europe and the UK to determine what recent macroeconomic, political, and competitive changes in the market mean for borrowers.
The lenders surveyed were spread across banks and debt funds, covering a wide range of ticket sizes and regions, providing a comprehensive view of the European leveraged finance market.
Over the past year, the European leveraged finance market has experienced favourable shifts amid a more stable economic environment, decreasing inflationary pressures, and gradually declining base rates. Competition amongst lenders has also increased, which has only been heightened by the closure of some of the largest direct lending fundraises in history. The resurgence of the broader syndicated loan market has further prompted banks and credit funds to reduce their spreads to remain competitive. The convergence of these factors has compounded optimism and bolstered confidence in the market for the year to come.
Key highlights
66%
of participants reported debt funds, including new entrants, were the primary source of competitive tension in the market.
80%
of debt funds raised new funds in the last 12 months.
54%
of participants reported a reduction of at least 25bps in margins, with 30% observing a reduction of at least 50bps in margins in the last 12 months.
42%
of debt funds indicated a reduction of at least 25bps in arrangement fees in the last 12 months.
“In 2024, we expanded our debt advisory presence, with new specialist teams now operating in Sweden, Denmark, Finland, and Ireland. Over the last 12 months, we have successfully completed 68 debt advisory transactions across Europe. As we move into 2025, the deal pipeline remains robust, driven by a strengthening M&A market, increasing demand for funding, and improving credit appetite from lenders.”
Simon Chambers, Partner and Head of Debt Advisory UK
Transactions
Not just numbers on a balance sheet, our transactions represent over 20 years’ commitment to our clients’ future. Helping them change the game. Even before it was ready to be changed.
Leading digital platform secures PE partnership reinforcing its position in the P&C insurance market
Adviser to ECI on its investment in Insurance Insider
Investment in the UK's leading lettings and estate agent platform to accelerate growth plans
Adviser to LDC and shareholders of Lomond on its investment from ICG
Securing finance package to bolster buy-and-build strategy of leading safety and regulatory compliance service provider
Adviser to Ansor LLP-backed Compliance Group on raising finance to support its ongoing buy-and-build strategy
Raising funds to drive acquisition strategy of key player in digital training
Adviser to Skill Dynamics on its refinancing
Clearwater’s European Debt Advisory team has over 35 experienced professionals completing over 68 transactions this year. These transactions range across primary debt raises, acquisition finance, refinances, amendments and restructurings for a wide range of borrowers, providing accurate and up-to-the-minute market intelligence.
Debt Advisory Lead
Simon Chambers
Partner
Our European Debt Advisory team
Manuela Scheibe
Partner and Nordic Head of Debt Advisory +46 76 722 51 00 manuela.scheibe@clearwatercf.com Connect
