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RM SecDirect Lending looks for more funding as demand for loans soars

RDML specialises in senior debt packages for small to medium-sized companies
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Demand for loans from mid-caps is strong

Debt-focused investment trust RM SecDirect Lending (LON:RMDL) has deployed £40mln of the £50mln raised when it floated last December and is on track to meet its dividend targets.

RDML specialises in senior debt packages for small to medium-sized companies, with eleven loans now in a portfolio that currently yields 7.7%.

At 31 March, the NAV per share was 97.31p and Total Net Assets were £48.9mln.

RM Capital Markets , the trust’s manager, said the borrowers include a healthcare group specialising in behavioural health, a UK high street retailer and a large UK/European forecourt provider as well as bespoke deals for UK residential bridging finance and student accommodation.

WATCH: RM Secured Direct Lending 'maintaining momentum' following £7.1mln raise

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“Based on the current portfolio, the company expects to achieve its stated annualised dividend yield target of 4% pa (based on the 100p IPO price) in its first year, rising to 6.5% thereafter for the year to 31 December 2018,” it said.

RM Capital added that since it floated the pipeline of prospective deals has grown with its own, directly originated transactions leading the way.

There were an additional £28mln of loans in advanced due diligence and documentation phase with a further £44m of prospective deals being assessed.

WATCH: 'It's been an exceptionally busy first quarter' - RM Secured Direct Lending boss

To meet the demand, RM Capital is in negotiations to establish a revolving credit facility and also expects to raise additional funds from investors in the near future.

James Robson, chief investment officer of RM Capital, said: "One of our core priorities was to deploy the funds quickly and into attractive assets, and we have done exactly that.

"There is significant demand from businesses of varying sizes, and across multiple sectors to access funding solutions that meet their specific financing needs and I am confident in our ability to continue to source and progress our pipeline of secured lending opportunities.”

 

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