Leading global law firm Herbert Smith Freehills Kramer has advised COFIDES, Spain's state-owned development finance institution, on its €30 million investment in Mustard Seed + Partners Fund I (the Fund), a European thematic private equity fund targeting €300 million.
The investment was made through the Social Impact Fund (FIS), a public instrument created under Spain's Recovery, Transformation and Resilience Plan and financed by NextGenerationEU. Managed by COFIDES and attached to the Ministry of Inclusion, Social Security and Migration, the FIS supports companies and entities generating measurable social and environmental impact.
Co-founded by senior investors with a combined 40+ years' private equity experience at KKR, Goldman Sachs, BlackRock and Mubadala, the Fund targets mid-market growth companies aligned with megatrends including energy transition, resource efficiency, and human capital and essential services.
Herbert Smith Freehills Kramer advised COFIDES from an LP perspective throughout the process.
The transaction underscores the growing role of development finance institutions in European private equity and the increasingly sophisticated legal frameworks needed for cross-border LP-side mandates.
The team was led by investment funds partner Joanna Pecenik Vergès d'Espagne (Luxembourg/Paris), with investment funds senior associate Nicolas Haas and associate Thomas Crahay (both Luxembourg), and tax partner Jean-Dominique Morelli and tax associate Adrien Kleinschmidt (both Luxembourg).
The mandate further builds the firm's Luxembourg investment funds practice, which advises amongst others, institutional clients, development finance institutions and private funds on alternative investments across private equity, credit, infrastructure and real assets funds.