Sienna Hephaistos Private Investments launches with InvestEU backing to strengthen Europe’s defence supply chain

Sienna Hephaistos Private Investments launches with InvestEU backing to strengthen Europe’s defence supply chain

(IN BRIEF) The European Investment Fund has invested €30 million in the first closing of Sienna Hephaistos Private Investments, Europe’s first private credit fund dedicated to financing SMEs and midcaps in the defence sector. Launched under the InvestEU Defence Equity Facility, the fund aims to raise €500 million to support 25–30 companies supplying critical technologies and components to Europe’s defence value chain. It will provide non-dilutive financing to help these businesses scale up, strengthen inventories, and overcome supply chain bottlenecks amid rising geopolitical challenges. With backing from the EIF, the European Commission, and Sienna Investment Manager, the fund is positioned to reinforce Europe’s defence readiness and strategic autonomy while expanding financing opportunities for specialised suppliers.

(PRESS RELEASE) LUXEMBOURG, 17-Sep-2025 — /EuropaWire/ — The European Investment Fund (EIF), part of the European Investment Bank Group, has committed €30 million as a cornerstone investment in the first closing of Sienna Hephaistos Private Investments S.C.A. SICAV-RAIF, the first private credit fund in Europe exclusively dedicated to supporting SMEs and midcaps serving the defence sector. This strategic move, carried out under the InvestEU Defence Equity Facility (DEF), marks a milestone in European defence financing and underscores the EU’s determination to strengthen security and resilience across the continent.

Managed by Sienna Investment Manager, the fund is designed to address structural financing gaps faced by specialised SMEs and family-owned companies that form the backbone of Europe’s defence supply chain. These companies, critical providers of customised components and technologies, often struggle to secure timely, non-dilutive financing to expand production during surges in demand, particularly in light of the war in Ukraine and heightened geopolitical tensions.

By providing tailored debt financing solutions, Sienna Hephaistos aims to support defence suppliers in scaling up production capacity, reinforcing inventories, and driving consolidation where necessary. With a target size of €500 million, the fund is expected to support between 25 and 30 companies within Europe’s defence industrial and technological base, helping them overcome supply chain bottlenecks while advancing the EU’s strategic autonomy.

The EIF’s €30 million commitment anchors the first closing of the fund, representing the first private credit vehicle backed under the InvestEU Defence Equity Facility. This initiative is specifically designed to mobilise private capital in support of Europe’s security and defence objectives, helping critical suppliers across the continent to grow, innovate, and strengthen Europe’s overall defence readiness.

Commenting on the launch, Andrius Kubilius, Commissioner for Defence and Space, stated: “Improving access to finance for defence SMEs and midcaps is a priority for the European Commission as it is key to enhance our defence readiness. Our support to the creation of Sienna Hephaistos Private Investment will expand financing opportunities in the EU for European companies developing critical defence technologies. This investment will support innovation, address supply chain bottlenecks, and facilitate industrial ramp-up.”

Marjut Falkstedt, Chief Executive of the EIF, added: “With backing from the InvestEU fund, we are proud to support this new initiative, which ensures ambitious industrial and technology companies in defence receive the non-dilutive financing they need to scale successfully. This will generate tangible impact in terms of strengthening European defence capabilities and securing our strategic autonomy.”

Ambroise Fayolle, Vice-President of the European Investment Bank, highlighted: “Contributing to the European Union’s security and defence is a priority for the EIB Group. This fund allows us to directly finance companies essential to Europe’s defence value chain, alongside other partners and investors.”

Paul de Leusse, Chairman of Sienna Investment Managers, noted: “The EIF’s strong backing has been crucial to launching this fund with a target of at least €500 million to €1 billion. This vote of confidence validates the work of our team over the past two years and demonstrates the mobilisation of financial players to support Europe’s defence industry, particularly the subcontracting chain. Private debt solutions complement traditional bank and equity financing, filling a genuine need for companies in this fast-moving sector.”

About the Fund

Sienna Hephaistos Private Investments is structured as a Luxembourg SCA SICAV-RAIF. Named in reference to Hephaestus, the Greek god of blacksmiths, it provides private debt financing to SMEs and small midcaps across the European defence value chain, addressing critical supply chain bottlenecks and supporting industry growth in a context of rising European defence spending. It aims to raise between at least EUR 500m from European investors by the end of 2026.

About Sienna Investment Managers

Sienna Investment Managers (Sienna IM) is a multi-expertise pan-European asset manager of the publicly traded investment holding company Groupe Bruxelles Lambert (GBL). With a team of around 300 professionals, Sienna IM operates in Paris, Luxembourg, Milan, London, Hamburg, Frankfurt, Madrid, Amsterdam and Seoul. Spanning listed and private assets, Sienna IM builds bespoke and innovative solutions for its clients, with purpose. As of end of June 2025, the Group oversees more than €40 billion under management, of which over 90% (AuM eligible under SFDR perimeter) are classified article 8 or 9. Through its French subsidiary, Sienna AM France, the group has developed deep expertise in thematic private credit strategies, including SME financing, energy transition, and defence.

About the EIF and InvestEU

The European Investment Fund (EIF) is part of the European Investment Bank Group (EIBG). Its central mission is to support Europe’s micro, small and medium-sized businesses (SMEs) by helping them access finance. Under the InvestEU Programme, EIF implements several mandates on behalf of the European Commission, including the Defence Equity Facility funded by the European Defence Fund (EDF), designed to strengthen the European defence technological and industrial base.

Press contact

Andrea Morawski, a.morawski@eib.org, tel.: +352 43 79 83427 / Mobile: +352 691 284 349
Website: www.eib.org/press – Press Office: press@eib.org

SOURCE: European Investment Fund