Liquidity Group raising $200 million for sixth debt fund
Liquidity Group raising $200 million for sixth debt fund
The Israeli fintech company currently manages five debt funds and two dedicated investment vehicles, for which $2 billion were raised, and one equity fund, for which $500 million were raised
Israeli fintech company Liquidity Group is raising $200 million for its sixth debt fund, Calcalist has learned. The Harel Insurance Group, which will invest $30 million in the new fund, will be the anchor investor. This is the first time that an Israeli institutional body is investing in Liquidity's debt funds. So far, Liquidity has already secured fundraising of $120 million.
The new fund will provide credit facilities of $2-20 million to growth technology companies operating in Asia, Europe, and the U.S. The underwriting will be carried out by Liquidity's technological system, which the company claims has experienced zero defaults in the last three years, and just a single case since it was established in 2018.
Liquidity, managed by Ron Daniel, is a credit-oriented fintech platform that invests, syndicates, and automates growth and middle-market lending for businesses around the world, providing capital mainly to later-stage technology companies.
The company currently manages five debt funds and two dedicated investment vehicles, for which $2 billion were raised, and one equity fund, for which $500 million were raised. After the completion of the raising for the sixth debt fund, the company's total raisings will reach $2.7 billion. The largest investor in Liquidity's debt funds is Mitsubishi UFJ Financial Group (MUFG), the largest bank in Japan, which invested $1.5 billion in the debt funds over several rounds.
Mitsubishi also owns 12.5% of Liquidity itself, after increasing its investment in the company by $40 million in February 2023. This fundraising was carried out according to a company value of $1.4 billion - 75% higher than the fundraising conducted by the company in April 2022 when the American Apollo fund invested in it, according to a value of $800 million. Apollo invested the majority of the amount in that round, the volume of which was $50 million, and at the same time invested $425 million in Liquidity's funds. According to the agreement with Mitsubishi, the bank will be able to sell the purchased shares back to Liquidity if the company does not go public within an agreed period of two years. Liquidity is targeting an IPO on Nasdaq or the Japanese stock exchange later this year. The scope of Liquidity's equity raising amounts to $120 million.
Liquidity's largest shareholder is Meitav Investment House, which currently owns 33.3% of its fully diluted shares. This is a successful investment for the investment house, as it made the first investment, in the amount of $540,000, in 2018, immediately after Liquidity was established, according to a value of only $1 million. At the same time, Meitav's CEO Ilan Raviv also personally invested $60,000. The last fundraising round yielded Meitav a capital gain of NIS 39 million. The shareholders of Liquidity itself include the venture capital fund Spark Capital, which owns about 18%. Daniel owns about 10% of the company.
Liquidity's headquarters are located in Israel, but it has offices in other countries and last November it even launched a development center in Abu Dhabi, with the help of the local investment center.
