Philosophy
“Attractive credit investments arise where in-depth analysis meets opportunity.”
Robus Capital’s investment approach combines fundamental credit analysis, disciplined risk management and active portfolio management. The focus is on debt instruments issued by mid-sized European companies that are often complex, receive limited institutional research coverage and are therefore not always efficiently priced.
Robus Capital’s strategies differ in terms of liquidity, risk-return profile and investment horizon. They are managed independently and can be divided into two areas: Performing Credit and Turnaround / Distressed Debt.
Performing Credit
“Investment success is determined not by the size of the market, but by the quality of the analysis.”
Within Performing Credit, Robus Capital invests selectively and independently of benchmarks, primarily in senior and/or secured debt instruments issued by stable European companies, predominantly with sub-investment-grade profiles. The Performing Credit funds aim to combine attractive recurring income from coupon payments with capital preservation and risk diversification. While the daily-liquid mutual funds focus exclusively on corporate bonds, the private debt strategies also invest in less liquid debt instruments such as syndicated loans and Schuldschein loans and provide selected direct financing.
Investments for the funds are selected on the basis of a fundamental bottom-up approach and an ongoing assessment of the risk-return profile of each allocated debt instrument.
Robus Capital is active in the primary market but also uses European secondary markets when attractive entry prices arise. When the risk-return profile of an individual investment is no longer compelling or the target price has been reached, the position is consistently sold. The objective is to maintain a portfolio that remains focused on the most compelling investment ideas.
Turnaround / Distressed Debt
“Our objective is to develop viable solutions. Sustainable value can only be created through a successful restructuring.”
Robus Capital’s turnaround strategy focuses on special situations involving companies for which Robus Capital sees a realistic prospect of successful restructuring, stabilisation and value recovery.
When existing creditors wish to reduce or fully dispose of their credit exposure, Robus Capital generally acquires debt instruments in the secondary market at a discount to their nominal value.
In selected cases, Robus Capital provides additional capital where there is a corresponding financing need and the existing creditors agree to such financing. These financings are typically structured on a senior, secured basis and on arm’s-length terms.
Robus Capital’s turnaround funds invest in a diversified portfolio of 40 to 60 issuers. Individual insolvencies cannot be ruled out in this segment and are an inherent part of the strategy’s risk profile. They are therefore always considered in the context of a diversified overall portfolio.
The objective is to stabilise companies and develop viable solutions together with management, creditors and other stakeholders. Value is not created through a company’s insolvency, but through successful restructuring, continued operations and sustainable value recovery.
Key Elements of Investment Approach
Robus Capital’s investment approach follows clearly defined processes. The following key elements form the analytical foundation of both strategies:
Market monitoring: Ongoing analysis of primary and secondary markets, sector developments and relevant corporate situations.
Idea generation: Leveraging long-standing market relationships with banks, brokers, advisers, lawyers, investors and company management teams to identify relevant investment opportunities.
Fundamental analysis: Detailed analysis of the business model, capital structure, cash flows, collateral and legal structure.
Financial analysis: Development of integrated financial models, scenario analyses and discussions with management teams, advisers and relevant market participants.
Relative value: Continuous comparison of existing and potential investments based on risk, return, liquidity and capital structure.
Investment thesis: Development of a clear investment thesis, including potential catalysts such as refinancings, maturities, changes of ownership, covenants or rating changes.
Capital protection: Focus on transparent capital structures, robust collateral and appropriate margins of safety.
Investment decision: Multi-stage decision-making process within the Investment Committee, based on independent analysis and disciplined discussion.
Company valuation and asset cover: Asset cover is used to assess the risk of an investment. It compares the value of senior and pari passu debt instruments, measured at market prices, with the enterprise value. This requires the enterprise value to be determined. Asset cover is effectively the inverse of the loan-to-value ratio commonly used in real estate finance.
Ongoing monitoring: Continuous monitoring of all investments at both individual position and portfolio level, including business performance, capital structure and refinancing capacity.
For the Turnaround / Distressed Debt strategy, additional analytical processes are applied, including company valuation using a sum-of-the-parts approach, collateral valuation and liquidation analyses.
Risk management
Risk management is an integral part of the entire investment process. Robus Capital continuously monitors portfolios at both individual investment and portfolio level. This is based on proprietary financial models, ongoing market monitoring and regular discussions with companies, advisers and market participants.
Robus Capital invests predominantly in senior and secured debt instruments. This can help to limit risks and strengthen the negotiating position in the event of unexpected developments at a portfolio company.
Risk management is based on the following elements:
Liquidity: Consideration of the liquidity of each instrument in the context of the respective fund strategy.
Diversification: Diversified portfolios with controlled position sizes.
Ongoing monitoring: Regular review of issuers’ business performance, capital structure and refinancing capacity.
Active risk management: Adjustment of the investment level during periods of market volatility.
For less liquid credit instruments, the focus is on continuous analysis of individual issuers, complemented by portfolio monitoring, liquidity management and, where appropriate, market-related hedging strategies.
Contact
Robus Capital Management Limited
9 Percy Street
London W1T 1DL
United Kingdom
t +44 203 7946 270
f +44 203 7946 269
e contact@robuscap.com
Robus Capital Management Limited is a regulated Financial Services Firm with registered office in London, United Kingdom.
Responsible Supervisory Authority:
Financial Conduct Authority
12 Endeavour Square
London E20 1JN
United Kingdom
Robus Capital Management GmbH
Bockenheimer Landstr. 51-53
60325 Frankfurt am Main
Germany
t +49 69 6770 174 0
f +49 69 6770 174 59
e contact@robuscap.com
Robus Capital Management GmbH is a regulated Financial Services Firm with registered office in Frankfurt, Germany.
Responsible Supervisory Authority:
Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin)
Marie-Curie-Str. 24-28
60439 Frankfurt am Main
Germany
Please note that your calls to Robus Capital may be monitored and recorded.