Rothschild Merchant Banking has closed its European mid-market direct lending fund at €655m, above its target of €400m .

Investors in Five Arrows Direct Lending (FADL) include insurance companies, pension funds, other blue-chip institutional investors, family offices and high net-worth investors. The fund, which is already 40 per cent committed into seven transactions, did not have a hard cap.

FADL provides debt financing, predominantly through senior-secured unitranche facilities, to support both private equity mid-market buyouts and mid-market businesses seeking financing for acquisitions, expansion capital, refinancings and shareholder reorganisations.

Rothschild Merchant Banking head Marc-Olivier Laurent said: “We are delighted with the success of the FADL fundraising, which has continued our track record of fund launches exceeding their fundraising targets. We are particularly pleased to have such a significant proportion of repeat investors from across the merchant banking platform.”

FADL compliments Rothschild’s high-yielding junior debt fund Five Arrows Credit Solutions, which closed in 2014 at €415m. The fund is now close to fully invested.