Baltic businesses to get financing boost with €20 million EIF pledge to SG Capital fund

• EIF commits €20 million to fund managed by Latvia-based SG Capital.
• Managed by a first-time team, the fund is expected to finance mainly SMEs and small mid-caps in the Baltics.  
• EIF is anchor investor in this fund which, aims to raise €100 million in total commitments.
• This operation is supported by the InvestEU programme.

Luxembourg/Riga, 13 January 2025: The European Investment Fund (EIF) is committing €20 million as an anchor investor to an initiative by Latvia-based SG Capital Partners AIFP (SG Capital) to expand financing for a range of businesses in the Baltic region. The EIF pledge to SG Capital Baltic Private Credit Fund aims to expand credit for small and medium-sized enterprises (SMEs) and Mid-Caps in Estonia, Latvia and Lithuania.

SG Capital Baltic Private Credit Fund, which will be managed by a dedicated team within SG Capital, aims to raise €100 million from a diversified pool of institutional investors, to support companies that lack sufficient bank lending. It will provide senior financing to SMEs and small Mid-Caps mainly in Latvia and Lithuania.

“This initiative is pivotal in providing essential financing to small companies in the Baltics, fostering economic growth and innovation,” said EIF Chief Executive Marjut Falkstedt. “Our investment not only bridges a critical funding gap but also signals our confidence in the region’s potential and the capabilities of SG Capital.”

SG Capital Baltic Private Credit Fund will offer tailor-made financing solutions, primarily in the form of senior loans and bonds, to help SMEs with acquisitions, capital expenditure, and working capital. The Fund will be classified as an Article 8 fund under the Sustainable Finance Disclosure Regulation (SFDR), with 15% of its investments dedicated to climate action and environmental sustainability criteria.

SG Capital Baltic Private Credit Fund expects its first closing in April 2025.

“At SG Capital, our mission has always been to support sustainable and impactful investments,” said Harijs Švarcs, Founding Partner at SG Capital Partners AIFP. “Building on the commitment by EIF, by introducing private credit that is a well-known and increasingly popular financing alternative in Europe and the US, we expand our financing solutions to empower Baltic businesses to pursue sustainable and profitable growth.”

“Private credit has a strong potential in the Baltics to complement financing sources considered by businesses that make long-term investments and acquisitions to support growth,” added Arvīds Kostomārovs, Head of SG Capital Baltic Private Credit Fund. “Private credit known for its flexibility, speed and non-dilutional characteristics offers a solution when traditional bank financing is out of reach and alternatives like bond issues are considered.”

Background information

About the EIF:

The European Investment Fund is part of the European Investment Bank Group. Its central mission is to support Europe’s small and medium-sized enterprises (SMEs) by helping them access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment. In this role, the EIF furthers key EU policy objectives such as competitiveness and growth, innovation and digitalisation, social impact, skills and human capital, climate action and environmental sustainability, and more. 

About InvestEU programme:

The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the European Union’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment. 

About SG Capital Partners:

SG Capital is dedicated to fostering growth and building long-term value in the Baltic region through strategic and responsible investments. As one of the first investment firms in the Baltics with a commitment to ESG principles, SG Capital focuses on real estate, forestry, and growth capital — supporting businesses and initiatives that drive regional development and are environment-friendly. Our team actively manages each portfolio, aligning profitable growth with sustainable practices that benefit communities and the environment alike. SG Capital has €200 million gross assets under management among two strategies, investing for 9 institutional investors over last 10 years.

Press contacts

EIB Group

Kristiina Randmaa

M. +352 4379 72894, e-mail:  k.randmaa@ext.eib.org 
Website: www.eif.org — press@eib.org 

SG Capital

Gunta Cekule

M. +371 2 9470754, e-mail: gunta.cekule@sgcapital.lv

Website: www.sgcapital.lv