Arcmont CIO Mattis Poetter says US lenders' retreat has reduced European mid-market deal competition

US direct lenders have barely invested meaningful money in Europe over the past six months, according to Arcmont Asset Management's chief investment officer Mattis Poetter. “The reality is for the last six months, they [US BDC players] have barely invested any meaningful money in Europe, while the Europeans had a very good fundraising period,” he told Alternative Credit Investor. The UK-headquartered firm, founded in 2011 and part of Nuveen, is one of the continent's biggest direct lenders, focused on the middle and upper mid-market.

That scarcity shows up in pricing. “There is less competition for every investment we're making,” Poetter said, “which is why we're often getting extra spread, better terms and less leverage.”

Recent redemptions from US business development companies have reduced the liquidity available to those lenders, according to the report. US managers had pushed into Europe after a surge of interest between 2024 and 2025, intensifying competition, particularly in large-cap deals. “That has shifted back,” Poetter said, describing a market again “dominated by the Europeans” — competition, but “much tamer and much more disciplined” than last year.

Some of the largest European managers have seen record raises over the past year, more than €10bn (£8.6bn) in some instances, per Alternative Credit Investor. Poetter argues that less capital is competing for European deals all the same, particularly in the middle to upper mid-market.

Four Australian institutions committed A$705m to a bespoke Arcmont European direct lending mandate, this publication reported on 1 September, with Europe positioned as the main beneficiary of US headwinds.