Edmond de Rothschild launches new small and midcaps strategy

Edmond de Rothschild Asset Management, with its culture of entrepreneurship and innovation, finances the real economy through its investments, guiding and supporting entrepreneurs at key moments in their operations and over the long term, whether their company is listed or not.

True to this commitment, Edmond de Rothschild AM is launching the Edmond de Rothschild SICAV European Smaller Companies fund, which reflects a strong conviction in small companies. At the forefront of innovation in multiple niche segments, they combine strong growth potential with an attractive risk/return profile, making them an essential segment for any asset allocation.

A long-term vision

The new Edmond de Rothschild SICAV European Smaller Companies fund aims to provide long-term support for small and medium-sized companies to help them reach growth milestones across Europe. By investing in particular in family-owned or entrepreneurial companies that are still limited in size but in a growth phase, the fund enables its investors to combine financial returns with a positive contribution to the real economy. In Europe, these companies account for 70% of the labor market. Thanks to their innovative business models, they play a key role in the structural trends of our society (demographic transition, digitalization, and the environment).

The fund's investment strategy focuses primarily on European companies with market capitalizations of less than EUR 5 billion at the time of purchase, which present earnings growth prospects combined with environmental, social, and governance suitability. The fund's investment philosophy is based on three pillars: conviction-based stock selection and fundamental analysis with an "on the ground" approach, active investment management combined with a rigorous risk management process, and a long-term investment vision that contributes to the success of companies.

The four essential criteria - revenue growth (CAGR), competitive advantage in the market landscape, high free cash flow generation (value creation), and high quality of management teams - are weighted by the fund's management team, which attends more than 800 meetings with target companies each year. Particular attention is also paid to sustainability, with job creation as a key element.

Entrepreneurship

Edmond de Rothschild, a privileged partner of entrepreneurs for many years, has also developed an entrepreneurial approach to financing through its private equity strategies. With this asset class, we provide concrete support to entrepreneurs developing their business plans by providing them with financing and monitoring their strategy. Edmond de Rothschild Private Equity goes further by selecting innovative, distinctive, and forward-looking strategies that address the challenges facing our society.

Our unique partnership model, which closely combines financial expertise and industrial know-how, guides new Private Equity teams in developing their strategy. This is how the Edmond de Rothschild Private Equity platform brings together engineers with environmental infrastructure and soil decontamination experts, company founders, and others.

The Amethis strategy, which aims to develop the entrepreneurial wealth of SMEs in Europe and Africa, is providing entrepreneurs with solid expertise and an entire ecosystem in Europe, Africa, and the Middle East. By taking advantage of this extensive regional network, SMEs can envisage the possibility of successfully going global and deploying an export development plan. The Trajan strategy aims to respond to the handover problems encountered by entrepreneurs who wish to hand over the reins, both from a capital and operational point of view, especially when retiring. The strategy of securing the future of these companies and accelerating their growth by finding suitable buyers is part of the process of preserving the regional economic fabric, which is vital for France.

Edmond de Rothschild's entrepreneurial spirit enables it to support entrepreneurs in the development of their business plans, not only by providing financing but also by participating in the strategy they devise. Throughout its family history, the Group has built a unique ecosystem for identifying, investing in, and decisively backing visionary projects.