Harnessing private markets to invest in structural shifts: LOIM’s approach

LOIM was pleased to host an investor lunch during last month’s IPEM conference in Paris. The annual event offers a dynamic platform for exchanging ideas, exploring market trends and showcasing innovation in private-asset investing.  Our investment teams presented three strategies that reflect LOIM’s aim to deliver strong financial performance while capitalising on structural changes reshaping the global economy.

Asset-backed loans: filling a growing lending gap

LOIM’s Asset Backed Loan strategy is designed to take advantage of a growing gap in the lending market, Co-Portfolio Manager Georges Gedeon explained. With a single investment, the strategy provides access to a highly diversified portfolio of asset-based loans (ABLs). Around 70% of the portfolio consists of direct co-investments, while the remaining 30% is allocated to specialist ABL funds¹, expanding access to manager relationships and deal flow.

We always try to find activities that are not speculative,
that’s very important.

Georges Gedeon, Co-Portfolio Manager, LOIM Asset Backed Loan

Targeting a 10% annual net return (IRR) including a 7% cash yield², the ABL strategy benefits from the advantages of co-investment, Gedeon said. These include a low-cost structure, and partnerships with experts across geographies and sectors. In just over a year, the team has reviewed more than 400 opportunities and executed over 55 co-investments, with an average maturity of just 1.4 years – providing short-duration exposure and risk control.

Georges Gedeon, LOIM Co-Portfolio Manager, Asset Backed Loan

The ABL team operates in areas where traditional banks have retreated, opening up a rich landscape of opportunities, the PM said. Whether it's financing media assets, real estate, receivables or a wide array of other assets, the firm steps in with capital secured against tangible, cash-generating collateral – favouring projects with clear, stable returns.

“We always try to find activities that are not speculative, that’s very important”, Gedeon said. “For instance, we avoid pure real estate development; what we want is a cash-flow-generating asset, or one that’s already built and just needs renovation”.

The strategy spans sectors and geographies, with deals in Asia, Europe and the U.S., including hotels, logistics and residential renovations. With a network of over 300 professionals sourcing and presenting deals, the team benefits from high-quality, well-vetted opportunities.

“The more we’re in this business, the more people know us, the more new relationships we have, and so it builds itself”, Gedeon said.

Read more: LOIM’s Asset Backed Loan strategy: built for diversified, defensive returns

Secondaries: mitigating the ‘J’ curve

Daniele Pitsch, LOIM Senior Investment Manager-Secondaries, outlined the many advantages of private equity (PE) secondary transactions. These include mitigation of the so-called J-curve effect. The term refers to the period early in the life of a typical PE fund, when performance is often negative as a result of LP cash outlays outpacing the value being generated. Secondaries avoid this ‘dip’ by deploying capital into transactions that are typically highly funded and targeting more developed underlying assets or portfolios – often entering at a discount to their stated fair market value(s).

Daniele Pitsch, LOIM Senior Investment Manager, Secondaries

As the secondaries market has evolved in recent years, deal types expanded beyond traditional Limited Partner (LP)-led transactions to include General Partner (GP)-led deals and direct secondaries, which require deeper underwriting expertise and a greater degree of specialisation.

“This market has firmly established itself as a core pillar of the private assets ecosystem and a value-optimising avenue to generate liquidity”, Pitsch said. “Perhaps most striking is the rapid expansion of the GP-led segment, which continues to generate not only increasing quantity but also a steady quality of transaction deal flow”.

Having invested in secondaries since 2009, our approach is supported by extensive partner networks and broad sourcing channels. The team is able to draw on prior experience with companies and relationships with stakeholders, Pitsch noted.

“The secondary market is evolving fast – investors are increasingly looking for solutions that combine visibility, attractive returns and distribution potential”, Pitsch said. “This is exactly where our strategy is positioned”.

Plastic Circularity: investing in the transition to a circular economy

IPEM also provided an opportunity to make our case for investing in one of today’s most pressing global challenges: finding scalable solutions to bring increased circularity to the plastics value chain and reduce the pressure on climate and biodiversity. 

Elise Beaufils, LOIM Deputy Head of Sustainability Research, and Alexandre Ouimet-Storrs, Investment Director-Plastic Circularity, introduced LOIM’s Plastic Circularity strategy.

With plastics accounting for about 5% of global carbon emissions³, the urgency to rethink how we produce, use, and dispose of the material is clear. PE has a role to play in accelerating the scaling of solutions and closing the funding gap between venture and strategic investments. 

A key point? Plastic not a niche concern, but rather a systemic shift reshaping a variety of industries, Beaufils said. Plastic is everywhere: from the casing of your phone to the interior of your car, your clothing and even medical devices, plastic is embedded across nearly every sector of the economy.

LOIM’s strategy is designed to address this challenge by investing in companies innovating across the plastic value chain, i.e., everything from material innovation that reduces reliance on virgin plastics, to collection and advanced recycling technologies that close the loop and prevent waste. The fund aims to deliver positive impact without compromising returns, targeting a net IRR of 18%⁴.

“There will be no single solution that solves the plastic problem — we’ll need to work on each part of the process”, Beaufils said. “We must be able to anticipate recyclability and end-of-life right from the design phase”.

The speakers stressed how circularity has become a business imperative, driven by a combination of policy, consumer demand and corporate responsibility.  Regulatory momentum, especially in Europe and France, is accelerating the transition.

The timing for investment is also favorable. Valuations have corrected, creating opportunities to deploy capital into critical technologies at attractive prices—solutions that are essential for decarbonisation and waste reduction.

“We invest in tons, not kilos”, Ouimet-Storrs said. “In other words, not in small lab startups or prototypes, but in established companies with proven technology, structured teams, existing revenues and a clear path to profitability”.

 Alexandre Ouimet-Storrs, Investment Director, Plastic Circularity

Positioned for a changing market

Through these three distinct strategies, LOIM aims to help clients gain exposure to high-quality investment opportunities in private markets as innovation and disruption create new value. From lending against real assets, to unlocking value in the secondary market and investing in circular economy solutions – we aim to build portfolios that are well-positioned amid broad structural change and evolving market dynamics.