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Theodora XU: Good morning, ladies and gentlemen. Thank you for being with us today. Today is about 3 words: acceleration, profitability and value creation. And everything we'll discuss this morning will connect back to these 3 priorities. I'm Theodora Xu, Head of Investor Relations for Tikehau Capital, and I'm delighted to be hosting today's full year results and strategic update. So today, you'll hear from our 2 co-founders, Antoine Flamarion and Mathieu Chabran; our Deputy CEOs, Henri Marcoux, Thomas Friedberger and Maxime Laurent-Bellue; and our Group CFO, Vincent Picot. So a little bit of housekeeping element on the flow of this session. So we'll first start with a look on Tikehau Capital key achievements for 2025 and then open the floor for a first session of Q&A dedicated to our annual results. We'll then take a short break to allow everybody to refresh, to grab coffee before moving into our strategic update. Then you'll hear first from Thomas, who will share his perspectives on opportunities shaping the next decade. Then we'll have Maxime hosting a fireside chat with our co-founders, discussing accelerating profitability across asset management. Then we'll have our co-founders and Henri provide insights on our evolving approach to balance sheet allocation before taking us through the harvesting phase Tikehau Capital is now entering and providing more details on profitability drivers and value creation framework. We'll then host a second session of Q&A dedicated to our strategic update. With that, it's my pleasure to welcome to the stage, Mathieu Chabran, Co-Founder, for opening remarks.
Mathieu Chabran: Thank you. Thank you, Theo. Welcome. Welcome, everyone, here in London, and welcome for all the people who dialed in on the webinar or the webcast. I hope that you can hear us okay. You got all the documents and that you will be enjoying this presentation with us. So very happy to be back in London, not only for our 2025 full year earnings, but also for this new Capital Market Day, as we call it, and very excited with -- on behalf of all the team to host you at Tikehau and give you a little bit of the forward-looking, which is really what we would like to focus on today. But first, let's start with our '25 earnings that were released this morning. I like to call it a record year because the numbers stand. But before we get into the numbers, I would like to tell you and witness how strongly the franchise has evolved over the past few years and the acceleration, as Theo was rightly saying that we benefited from in 2025. It's been a record year on the deployment despite if you look back and think about what 2025 was as a year and as markets to operate in, that was a record year on the deployment. On the realization, we come back to that on exiting some of our portfolio companies and distributing back to LPs and as well as the fundraising, the gross and net inflows, we'll get back to that. We told you in 2022 that the focus was to develop, grow the profitability of the asset management. Remember that when we went public 9 years ago, we were barely doing EUR 5 million of EBIT. It's close to EUR 150 million this year. And you will see that this growth and expansion in asset management profitability is here to stand and we'll give you some guidance where we think we can go. And then finally, on the portfolio, you've got these 2 engines at Tikehau, right, the asset management, the principal, our balance sheet, we saw some strong contribution, albeit this year impacted by some ForEx, and we'll come back to that. So as I was saying, record in deployment, realization inflows. On the deployment, it's EUR 7.6 billion that we put at work at Tikehau, which is an increase of 35% compared to 2024. On the realization, on the exit, we like to say at Tikehau that you have to give back so that people keep giving. And you keep hearing about investors not getting money back. What we tried to do last year is to demonstrate that, yes, you can exit some portfolio company, give back to your investors so that, that keeps fueling the next cycle of growth. And that was twice what we did in 2024. On the capital formation, it's EUR 10.5 billion of gross inflows, and that's the fourth consecutive year of a record year in fundraising. It's EUR 8 billion in net inflows. And what we are very encouraged by is that the whole investments we made in the platform over the past few years globally, remember, we went public, we had 5 offices. When we saw you in 2022 for the Capital Market Day, we had 7 offices. It's now 17 offices we've got across the world. And from Asia, including Japan, Middle East, across Europe today, North America, even South America now, we've got all these new customer base that are fueling the fundraising at Tikehau. So 80% last year came from new customer base, new geographies outside of our domestic market, taking our overall AUM to EUR 52.8 billion. So as I was saying, we've been focusing on larger transactions with a more global portfolio, not only in Europe, domestic market, but in Asia, in North America. And that has enabled us to raise additionally more than EUR 1 billion, EUR 1.2 billion of co-investments on some of those larger transactions. You'll have some examples later on that you may have picked up over the past year, but that has been a strong driver. On the capital formation, as I was saying, a few elements. In Asia and Middle East, it's EUR 1 billion that was contributed. We hit the EUR 1 billion of inventories of clients in Korea that we had opened 6 years ago. And just I'll give you an example that we kind of like just last year, out of the EUR 10.5 billion gross inflow we had, 4 investors -- 4 new investors actually accounted for 20% of our fundraising, and they were all new relationships of ours, bigger commitments. I mean, they came from some very complicated to penetrate markets. I'm thinking about Japan, thinking about Germany. I'm thinking about the U.S. I'm thinking about Middle East, GCC, Abu Dhabi. This is a strong illustration that the investment we made in the platform is now paying off, and we're harvesting all this investment that we had made. And so as I was saying, giving back capital to RPs EUR 4.1 billion that we returned to our LP last year. And just as a data point because people have been talking a lot about private equity last year, and I'm sure we'll have plenty of questions about private credit as well, and we're looking forward to addressing them. But it's a 2.6x that we returned to our investors on the realized transaction. So where does that leave us on the financial? I mean, we issued this morning all the numbers in the details, we'll come back. But if I look at the first pillar of our business, our asset management business, it's an 8% growth of our revenues, converting into 18% growth on the -- at the EBIT level. We grew by 12% our core FRE, this fee-related earnings. And for the first time, as we told you a few years ago, we passed the 40% core FRE margin, and you may have picked up, and we will come back to that, that we're giving an improved guidance on this very important profitability element. On the second pillar, on the portfolio, it's a 19% growth in our realized revenue for the balance sheet, our investment portfolios and a 33% revenue growth if we exclude once again these currency effects that Vincent will be detailing. So finally, it's EUR 136 million net income that we are reporting for 2025, which is 51% growth if you exclude this currency effect. And so we will be -- we propose EUR 0.80 dividend that we'll be voting at the next AGM. So that's for the key element. There will be plenty of details on the session. Once again, thank you very much. We look forward to an interactive session. Thank you, and I will hand over to Henri for more details.
Henri Marcoux: Good morning, everyone. Thanks, Mathieu, for this introduction. So let's jump into our asset management flywheel. Maybe we'll start with deployment. As you have seen, deployment has clearly stepped up during the year '26. We've reached EUR 7.6 billion of deployment. So that's an additional EUR 2 billion, 35% compared to the year '24. Starting with private equity maybe, with a EUR 2 billion compared to EUR 600 million the year before. Clearly, we've accelerated deployment, notably on aerospace and defense, cybersecurity, decarbonation in Spain, Belgium, Germany and in U.S. through our flagship strategy, but as well through our co-investment vehicle. Real assets represented EUR 1.4 billion of investments compared to EUR 1 billion during the year '24. Here again, discipline has remained paramount. We continue to focus on high-quality, well-located assets, notably to be noticed during the year '24, big residential portfolio units in France as well as a big investment, first investment in real estate in the U.S. and notably several additional investments in the Netherlands. As far as credit is concerned, so that's clearly a stable deployment versus '24. We are standing at EUR 4 billion, very well diversified allocation through Spain, Italy, Netherlands, Belgium, U.K., very strong momentum as well on our CLO issuance business. And so we are ending the year with more than EUR 7.6 billion of dry powder end of '25 to be ready to capture new investment during the year '26. We've been talking about executing larger transaction. That's a very key important point that we wanted to mention today. So out of this EUR 7.6 billion of deployment during the year, we had EUR 1.2 billion that were deployed through dedicated co-investment vehicle. That has been the case on the private equity business, such as the Egis transaction we've been commenting for a few months. EYSA in Spain, that has been the case for as well ScioTeq aerospace and defense deal in Belgium. That has been the case as well for real assets through this residential deal. That has been the case as well for private debt, where we had several deals where we have welcomed co-investor. So that's clearly a new feature here, creating adjacencies, creating new funds alongside our flagship and welcoming co-investors. What does that mean? That means that through this creation of new vehicle, we are bringing into the platform additional fee paying. So management fees that are going to fuel our fee-related earnings and additional performance fees, which will depend on the exits, of course, but which will fuel as well our asset management EBIT. So looking at what happened in '25 over those co-investments, that's roughly more than EUR 1.2 billion of additional co-investment, bringing more than EUR 150 million of asset management EBIT for the coming year. Realization, clearly here, once again, a strong increase. It's almost double figure as what was exited in '24, so reaching EUR 4 billion of exits. Here, again, private equity has been increasing significantly. That's EUR 1 billion of exits for 5 positions that were exiting during the year, reaching 2.6x of multiple. So clearly in line with our fund expectation. As far as real estate is concerned, we remain stable, EUR 500 million of exits. Multiple on real estate achieved has been 1.6x. That's at asset level, unlevered and those exits are mainly residential and light industrial. As far as private credit is concerned here, clearly, very strong increase. Realization have reached a record that's almost EUR 2.7 billion. As far as direct lending and corporate lending are concerned, those are repayments. The average MOIC reached has been 1.4. As far as our specials business is concerned here, we've been exiting several positions as well at our initiative, achieving a gross MOIC of 1.6x. I want to insist on that because clearly, in '25, I think that the global macro environment as far as exit is concerned, has been challenging. In that context, we've been able to deliver EUR 4 billion of exits. So we are sending back money to our LP. we are increasing the DPI, which is key. We are increasing the performance and all the average gross MOIC that have been realized on all of our exits are clearly either in line or above our fund expectation. Fundraising. So here again, we've been mentioning EUR 10.5 billion of gross inflows, record year. As far as net inflows is concerned, that's EUR 8 billion of net inflows, so a 13% increase during the year. Looking at this fundraising a little bit more in detail. You can see that as far as private equity is concerned, we've reached EUR 2 billion. I'll come back on that. Notably, those inflows have been driven by the cybersecurity final close, regenerative agriculture as well. Our specialist fund being decarbonization fund #2, aerospace and defense fund #2 have been benefiting obviously from strong inflows in the current environment. As far as real estate is concerned here, it's a performance of EUR 1.3 billion of net inflows, focusing on value-add and Core and Core+. This is including the previous transaction I was mentioning, notably residential in France, the one in the Netherlands as well. Strong contribution from credit, EUR 4.4 billion, stable versus last year. As we just announced a few days ago, we've been closing our credit secondary fund #2, $1 billion, which is almost double the size versus previous vintage. As far as direct lending, vintage #6 is concerned, which is still open as we speak, we are close to EUR 5 billion. And here, we have secured the 2 largest individual LP commitments in our history from Germany and in U.S. Demand as far as direct lending is concerned, remained quite strong. So as you can see over here, diversified strategy, larger tickets, co-investment, client conviction, bringing us into this record EUR 8 billion for the year '25. So just a snapshot here on where we stand on our flagship. So I was mentioning special opportunity fund number -- vintage # 3, EUR 1.2 billion, which is almost the double versus the previous vintage. Credit secondary, $1 billion. As far as private equity is concerned, regenerative agriculture, vintage #1, EUR 600 million; cybersecurity fourth vintage, almost doubling the size versus the previous vintage. As far as '26 is concerned, lots of ongoing fundraising as we speak. Obviously, direct lending #6 still open as we speak and benefiting from strong inflows. This year will be as well a strong year as far as private equity is concerned, we are still open during all the year, Aerospace and defense fund #2 and decarbonization fund #2. So you have here on the screen the evolution of our AUM during the year. So it started at end December '24 at EUR 49 billion, ending at EUR 52.8 billion. Different movements of the year have been impacted by the inflows I was mentioning, EUR 8 billion and the distribution standing at EUR 4.1 billion. You have on the right side of the page, the diversified and complementary asset class, the split by business unit. Client base, as far as client base is concerned, one important feature, Mathieu was mentioning the number of offices we are operating, namely 17 offices as we speak. Important to notice that as far as inflows are concerned, that's more than 80% of net new money that has been raised from international clients. You have here the biggest contributors for the year '25 being U.S. investors, U.K., Spain, Germany. To be noticed during the year '25, strong contribution from Asia, namely from Korea and Japan. Korea has gone over the EUR 2 billion mark for the year '25. Contribution as well from Israel, where we are approaching the EUR 2 billion mark as far as the LP commitments are concerned. So those are the most represented nationalities in '25. On the right part of the page, you do have actually the split, which means that international clients have increased from 44% '24 to 46%. So that's a 13% increase, representing EUR 24 billion at end of '25. Private market is an important feature. We've been focusing significantly over the past year over the strong growth, era of growth. That has been the case as well for '25. That's 25% of third-party inflows that were raised through private clients. That's actually notably all the initiatives we've been launching on private debt, private credit, unit-linked products have now reached more than EUR 1.5 billion at end of December. As far as AUM are concerned, that means private customer clients are now representing more than 34% of our AUM. That's actually more than EUR 18 billion. Two dedicated initiatives that have been launched during the year '25, one on private credit, namely TEPC, European private credit, semi-liquid fund, focusing on midsized European company. And second important initiative that was launched during the summer, which is a unit-linked dedicated to defense, security, aerospace. This unit linked is currently distributed through partnership that we're having with big insurance company. We are currently sending over EUR 200 million for this product, which -- where the distribution has started end of '25, focusing on our aerospace and defense practice and notably the track record that we are benefiting on that practice, aerospace and defense practice that was launched back in 2018. Last point on sustainability. A few years ago, we had set a target on AUM dedicated to climate and biodiversity. Our target was to achieve at least EUR 5 billion of AUM dedicated to that practice. End of '25, we are standing at EUR 5.8 billion, notably thanks to our decarbonization practice, Fund #2. So that means continued sustainability integration across the several pillars that we are benefiting through the WL platform. I will now leave the floor to Vincent for the financial review. Thanks.
Vincent Picot: Thank you, Henri. So I'll start the financial highlights with our fee-paying AUM and the revenue generation in terms of revenues. So first, fee paying AUM grew by 6% compared to 2024. It was driven by net money on our private equity practice, capital markets and also by a very dynamic fundraising and deployment activity for direct lending and CLO business. In addition, it's worth mentioning that future fee-paying AUM grew by 24%, and it was supported by solid net money in direct lending strategies. We charge management fees on invested capital. So together, fee-paying AUM and future fee-paying AUM increased by 8% year-on-year. So that's a sign of securing future management fee generation. Also and the impact it has on management fees is that management fees increased by 8%, reaching EUR 358 million. That's an acceleration that we have noticed specifically in H2. Average revenue margin stood at 88 bps, which remains resilient. And worth noting that we record a clear performance-related earnings level of EUR 22 million, which is a record. On the following slide, a few data points on performance-related earnings. So at end 2025, AUM eligible to carried interest grew by 10% to EUR 24.8 billion. In addition, at end September 2025, we had EUR 220 million of annualized performance-related revenues, which are actually accrued at fund level and such level is based on the current performance at portfolio level. This amount is not crystallized yet. It is not yet accounted for in our P&L, and it will be recognized as funds approach maturity. In terms of asset management profitability and as Mathieu mentioned, we grew our asset management EBIT by 18% year-over-year, reaching for the first time EUR 150 million. This growth reflects specifically the increase in the core fee-related earnings with a notable acceleration in H2. This is mostly due to an increase in management fees in this period. Overall, Core fee-related earnings increased to 41% in terms of margin, exceeding so for the first time, the 40%, and it reached exactly 46% in H2. Overall and looking now at the cost base, we remained very disciplined because the operating cost base only grew by a mere 3% year-over-year. So that's a testament of an efficient resource allocation. Moving now to our investment portfolio. So at end 2025, the total fair value reached EUR 4.4 billion, very -- and still very granular with a bit more than 300 investments. Approximately EUR 3 billion of this amount is invested in our own management strategies. So it ensures an alignment of interest with our client investors. The remainder of this amount, EUR 1.3 billion is invested in our direct investment ecosystem. As you can see on the right-hand side, we've got a pretty well diversified portfolio in terms of asset classes. Now looking at the flows and what happened over the year, investments reached EUR 1.3 billion, of which EUR 951 million of capital calls in our own strategies, CLO, credit secondaries, private equity strategies mostly, but we also invested EUR 370 million in our ecosystem, and it was mostly driven last year by our investment in Schroders. 2025, so we carried out close to EUR 800 million of exits. Returns of capital were from various asset classes, CLOs, special opportunities, but also decarbonization and aerospace strategies that Henri mentioned when talking about distributions to our LPs. Market effects, minus EUR 18 million, reflecting mixed effects, positive fair value changes for our Schroders stake, also positive regulations in some of our private equity strategies, mostly aerospace and defense and also decarbonization, but it was offset by negative market effects in some very specific credit and real estate situations. And finally, currency effects amounted to minus EUR 161 million, and it's mostly linked to the sterling euro exchange rate. Slide 20 -- next slide. So in terms of portfolio revenues. So in 2025, portfolio revenues reached EUR 166 million. That compares to EUR 207 million in 2024. But as mentioned also by Mathieu, realized revenues actually grew very significantly by 19% year-over-year, reaching EUR 239 million. So that's worth highlighting. It's composed primarily of coupon, dividend and distribution from our whole spectrum of credit strategies, listed REITs and also ecosystem investments. As regards unrealized revenue of minus EUR 73 million, we've got a P&L impact of foreign exchange for minus EUR 52 million, mostly linked to the euro-sterling exchange rate. And as I explained in the slide earlier, also around minus EUR 20 million of unrealized negative changes in fair value. So excluding currency effects, our portfolio revenues grew by 33% year-over-year. If I have to wrap up our 2025 financial performance, strong performance in our asset management platform, as explained on the asset management EBIT growth. It was offset to some extent by currency effects and also by unrealized fair value changes on our investment portfolio. Looking now in a bit more detail, nonrecurring items and other of EUR 13 million. It's mostly linked to positive ForEx impacts on our U.S. financings. Tax expenses, EUR 51 million in 2025, in line with our net result before tax and a tax rate of around 25%. So overall, our net result group share amounts to EUR 136 million. And if we exclude main currency effects, our net result grew by 51% year-over-year. In terms of balance sheet metrics, our model is strong, supported by means of EUR 3.1 billion of shareholders' equity group share and also by short-term financial resources of EUR 1.2 billion. As regard our financial debt, which stood at EUR 1.9 billion, it encompasses a EUR 500 million new bond issue, a renewed and upsized RCF line of EUR 1.15 billion. And at end of December 2025, we had drawn EUR 150 million of our revolving credit facility. And as of today, we have fully reimbursed our RCF. In terms of -- so based on this -- so building on what I disclosed and building on our 2025 performance, we're also pleased to formulate a new 2026 vision that is disclosed on the screen. We will be laser focused on reaching an AUM of at least EUR 60 billion by end 2026, reaching FRE between EUR 175 million and EUR 225 million and the net result group share between EUR 420 million and EUR 520 million, excluding ForEx effects. Worth noting that approximately EUR 180 million of net result comes from the full disposal of our stake in Schroders that happened earlier this year. And also, we also disclosed a return on equity between 13% and 16%. So all those metrics show improvement compared to 2025 and are above market expectations. 2026 has to be seen as a step in our journey towards a long-term profitable growth that will be disclosed and presented just after. And we will be providing, of course, more details on our targets later this morning. Thank you very much for your attention. I will let Antoine for the concluding remarks.
Theodora XU: Thank you, gentlemen, for this very thorough presentation. We'll now open the floor to questions. [Operator Instructions] And we will address in priority questions from the room, obviously, and also take questions from the webcast. So one question from Sharath Kumar from Deutsche Bank.
Sharath Ramanathan: Very impressive presentation. So congratulations. I have 2 questions, if that is okay. So first one is while I totally understand your investment story, but I think it will be much simpler with an asset-light business, although I kind of understand where you're coming from in terms of your balance sheet, funding your strategies. But ultimately, I think it is very hard to deny that this has been hugely dilutive to your valuation. So has there been discussions to eye off the investment activity outside the listed entity so that it can improve your valuation? So that is the first one. And I want to come back to the usual topic on your share price valuation, low free float. A couple of years ago is when you disclosed your 2026 targets, at least on the asset management side, you have been mostly on track, while on the investment activity side, is there, I think consensus is widely divergent from your targets. Just been a very painful wait for the sector to rerate and you have not been alone in that. So -- but when it comes to increasing the free float, what is the latest update that you can give you? I know it's been a chicken and egg situation for the valuation to increase or the free float to increase, but what is the latest update that we can?
Antoine Flamarion: Thank you for your question. That's a usual relevant question we had on balance sheet and asset light. As you all know, we started the firm just as an investment company in 2004. In 2007, we launched the asset management. So our asset management is 19 years old. We are celebrating next year our 20-year anniversary for the asset management. So we decided from day 1 that having a balance sheet will help fuel grow the asset management. And as we discuss a little bit later during our strategic update, we'll be more precise into that. But the truth is that we've been using the balance sheet to seed sponsor new initiative. Without the balance sheet, it would have been impossible to launch CLO in 2012, direct lending in 2009, decarb in 2018, aerospace and defense in 2020. Needless to say that nobody will even answer our phone. So we used the balance sheet to seed sponsor that. As a result, we have this balance sheet, a EUR 5 billion balance sheet and now a EUR 53 billion AUM business. We are clearly unhappy with the valuation. The sum of the part is miles away of what we should be. So clearly, we don't get the credit of having both the balance sheet and the asset management. For all of you who are very familiar, you just saw the latest M&A transaction announced, which is the Coller purchase for EUR 3.2 billion. Coller is making EUR 145 million of EBIT, let's say. So we just announced EUR 150 million. So that tells you more or less the valuation we should get on the asset management. And on top of that, we've got EUR 3.1 billion of equity. So we've been growing the firm using the balance sheet to seed sponsor, launch new initiative. As we enter now a new chapter, and we'll discuss that during the strategic update, we are committing less amounts to our funds. We don't really need now to seed sponsor with large amount of money. And as you see for the first year in 2015, the commitment we had in our fund declined. So we started the year with EUR 1.6 billion of commitment in our fund. At the end of the year, it's EUR 1.3 billion. So that's telling you that we don't really need as much capital as we needed before. So moving forward, we'll have really the 2 businesses, the principal investing, which will still remain invested in our funds. Skin in the game is critical for us. And we have the asset management business, which is now profitable. When we leased the firm, if you remember, we are making EUR 4 million EBIT, so no profitability at all. In 9 years, we grew from EUR 4 million to EUR 150 million. As you saw on the 2026 guidance and vision, we are targeting between EUR 175 million and EUR 225 million of FRE. So now asset management is profitable. The balance sheet, we think, is really back on track to be profitable. Vincent mentioned, for instance, Schroders, we will detail that, but Schroders has been a 64% IRR and a EUR 240 million net income. So that's why we are highly confident on the 2026 net income. So it's a very long answer to your question. People have very clear view on asset-light versus non-asset-light. Blackstone is really asset light. KKR is not asset-light. KKR is not compounding at a strong pace, the balance sheet. And at the end of the day, for the shareholder, I think what matters the most is the net income and to increase the net income, having the 2 engine, the balance sheet and the asset management will probably lead into more net income, more dividend and share price appreciation at the end.
Theodora XU: Thank you. Two more questions in the room from Arnaud Palliez from CIC.
Arnaud Palliez: Two questions related to currency impact. The first one is, can you give us the breakdown of your AUM by currency in order to forecast what could be currency impact on these assets? Then do you intend to put in place any hedging policy? I think all your debt is in euro. So do you intend also on the liability side to have a diversification by currencies? And the last one is regarding the net profit guidance for 2026. Is it at constant currency? Or do you make any assumption at this level?
Vincent Picot: Okay. Thank you for your question. So as regards assets under management and the part of the share in foreign currency, so it's about 10% and mostly in U.S. dollars. We're exposed to the U.S. dollars around and through our U.S. CLO and private debt strategies mostly. As regard to your question around hedging, so we've got a hybrid approach at Tikehau. Like other actors in the sector, we have decided to put in place a natural hedging with financing in dollars. So it's $180 million private placement put in place in 2022. And we also put in place some forward contracts on some sterling on our sterling exposure to some extent. So we've got this hybrid approach using these options at our hand. And regarding your last question around our 2026 guidance in terms of net results, which we mentioned is between EUR 420 million to EUR 550 million. We mentioned very specifically that it's excluding foreign impacts. So basically at constant currency December 2025.
Antoine Flamarion: And what we'll do moving forward when it comes to currency, when we have been issuing bonds, we've been initially only raising money denominated in euro. A few years ago, 3 years ago, we raised for the first time a USPP, dollar-denominated. So moving forward, we will probably match our non-European currency exposure, matching with the right liabilities, so probably issuing more USPP rather than euro if we need. We consider that it's probably the best way to hedge having a proper asset and liability match. It costs less money. It's much more efficient. And this hedging currency are always complex because you can hedge the amount of money you invest. So let's say you invest $100 million, GBP 100 million, you hedge that. But if you end up making 3x multiple having just the nominal hedge, your capital gain is not hedged. So we think that moving forward, we're going to issue more in other currency, if I may say.
Theodora XU: One question from Nicolas Vaysselier from Exane BNP.
Nicolas Vaysselier: The first one is on Schroders. I mean, you have a big windfall coming your way. That's a great problem to have, right? I'd like to know how you think about reallocating those proceeds between reinvestments or potentially payout to shareholders through share buybacks, exceptional dividends? Second question on your 2026 new FRE guidance. I'd like you to help us understand a bit how we bridge from where we are in '25 to get to the bottom end or even the top end of this guidance. So I'm wondering if you bake in some lumpier items like catch-up fees that you're expecting for this year, expecting some recovery at Sofidy in the subscription fees because they are meaningfully accretive to the margin. And what you expect in terms of evolution of the cost base next year? And then finally, my third question, you mentioned some negative mark-to-market effects on the credit portfolio. We've seen some of your peers actually suffering quite a bit. So I'm interested in any comments about your credit portfolio, balance sheet exposure, how it's performing and on the equity CLOs notably.
Antoine Flamarion: Thank you for your question. Maybe I take the first 2 one. On reallocation or reinvestment, as mentioned before, we still have EUR 1.3 billion of commitment into our funds. So first of all, for instance, the Schroders proceeds is close to EUR 600 million. As Vincent mentioned, we are going to -- we reimburse already our RCF, which was EUR 150 million drawn. So that means that we have excess cash on the balance sheet. We're going to probably use that for our capital call, EUR 1.3 billion. Also it's over the next few years. So it takes time. We're going to continue to invest the balance sheet alongside our strategies. So we have commitment in our funds, but the balance sheet is now doing 2 things, co-investing within our strategy. So I suspect we're going to probably deploy more money into aerospace and defense, where we are clearly ahead of the curve. Same thing for decarb. And we start seeing more and more credit opportunities as the cycle is becoming more complex. You probably read a few days ago that we closed our secondary -- second vintage of private debt above EUR 1 billion, so twice the previous vintage. We are the only firm having such track record when it comes to secondary private debt. So I suspect that we're going to allocate the balance sheet more into secondary private credit. Maybe I start on the -- your question on 2026, and I will let Henri comment. So we have 4 metrics in our 2026. One is our return on equity between 13% and 16%, which is mid-teen double digit, as mentioned before. We are fairly convinced that we should reach between EUR 420 million and EUR 520 million of net income for 2026. Part of that is obviously the Schroders disposal. And as disclosed in the market, we decided to sell in the market our stake rather than waiting the end of the offer, which could happen in Q4, but could happen maybe in Q1 2027. You never know. So we are fairly convinced that we're going to reach this level of net income and as a consequence, this return on equity. Your question specifically on catch-up fees and FRE we have several vintage of private equity currently raised, namely AAP2, which is aerospace and defense and decarb 2. There is potentially a very large amount of catch-up fees as stated in the bylaws. So within this range of EUR 175 million to EUR 225 million, there is some amount of catch-up fees, and we are fairly convinced of -- when we look at our pipeline right now coming from LP, there is a very strong demand, obviously, for aerospace and defense, and there is still many European appetite for decarb.
Henri Marcoux: Yes. Maybe in summary on that, there are many 3 drivers on that. First of all, you may have seen that future fee paying have been increasing significantly end of '25. So all these future fee paying will obviously be transformed into fee-paying when we will be deploying these funds. So this is the first driver for our evolution of fee-related earnings in '26. Second one is a mix effect. Obviously, as just described on the pipeline within our funds, we are now on the road investing and fundraising on our 2 big platform PE funds, namely decarbonization Fund #2, aerospace and defense Fund #2. Yes, there will be catch-up fees. But namely out of the -- maybe excluding even the catch-up fees, there's a mix effect with these 2 private equity funds and the track record we have benefiting on these 2 area. And maybe the third driver to increase effectively the FRE in '26 is obviously cost control. We started to be more -- to take carefully more of the issue around cost already back in '25, and we will be keeping in that area for '26.
Mathieu Chabran: No, I just want to address the third question on private credit. I mean, I wish we had 2 hours to discuss private credit since so many things have been written over the past few weeks or a few months. But more specifically, we happen to have our CLO business within private credit. So just to answer specifically on the U.S. side beyond the ForEx that Vincent elaborated on, obviously, last year was a volatile year. And as you know, the CLOs or some arbitrage vehicle with some liabilities issued and that can be reset. And so what we had last year was effectively on this specific part, some kind of a lag between the end of September, end of December valuation at the asset side and the reset on the refinancing. So we're expecting to catch up on this side when we reprice and reset the CLO. Now more specifically on the private credit, I think there are as Antoine said, that's a big opportunity for secondary private debt, but we've never been as bullish on the opportunities to keep deploying with the same underwriting discipline when it comes to direct lending. The issue we've been facing, there are 2 comments. One is cyclical. The other is structural. On the cyclical aspect, what we've experienced partly in the U.S. is this massive growth and fundraise on credit where many managers and not being judgmental whatsoever have started to have to deploy resilient raise. And as you know, when some of our competitors raise $50 billion a quarter, it takes some time to keep the same discipline underwriting. We're still, I think -- and our partner, Cecile is in the room, I think we have 5% to 7% selection rate on our private credit deployment. So that has been driven effectively a lot of talk around the direct lending. The other thing that in the U.S., the bulk of all the noise you've been hearing was coming from the U.S. You've got the mid-market direct lending, which is on average, 6 to 7x now level. In Europe, it's more like 5 to 5.5. Our portfolio is 4.4. So as always, with credit, because the only thing you're getting is par, it's how do you underwrite and how do you structure going in. So it's a much more defensive portfolio that we've been having, and we just closed the sixth vintage of our strategy. We started in 2007. So it's a 19 years track record when, as I'm sure you know, 92% of the private credit managers were launched post GFC. So I think that here, it's important to -- I mean, we have our share of situation of negative watch where we're working. A lot of the cyclical aspect is effectively all the credits that were originated in 2021, the 0 interest rate environment, the Central Bank very accommodating policy and when people -- you had a base rate at 0 and spreads at 300, obviously, fast forward 5 years and you got a base rate at 4 or 5 and the spreads may be at 4 or 5, obviously, your cost of refinancing is much higher, and then you have to effectively recapitalize part of them. Now the silver lining, as Antoine alluded to, is that we're entering the golden age of the secondary private credit, and we are best positioned to tackle that.
Theodora XU: Well, thank you so much. I'm sorry, I'm conscious of time. We'll address more questions later on during the second Q&A session. So let's take a short break. We'll resume in 10 minutes. Thank you very much. [Break]
Theodora XU: Welcome back, everyone. So before moving into the strategic update, we would like to take a few moments to step back and revisit who we are and how we have built our platform. So we're going to show you a short video that retraces our journey, highlighting the evolution of our platform and the areas of expertise that position us as a differentiated asset management. Let's watch. [Presentation]
Theodora XU: We hope you enjoy this video that really captures our journey. So today is not only about looking back, it's about what our platform is capable of delivering. We would like you to leave today's session with 3 key messages. First, we're exiting our build-out phase in asset management to move into a harvesting phase with accelerating profitability. Second, we're entering a new phase characterized by a greater strategic allocation of our balance sheet. It has been used since IPO as a great growth enabler. And now looking ahead, it will be used as a more strategic allocator. Finally, as Antoine mentioned a bit earlier, those 2 distinct and complementary growth engines will offer significant optionality for us to close the valuation gap and also maximize value creation for our shareholders. Aligned with our '26-'29 road map, we'll be focused on delivering the following objectives. First, deliver cumulative net inflows of over EUR 34 billion, representing a 22% growth compared to the EUR 28 billion we have raised over the last fundraising cycle. This is first one. And the second one is that we aim to generate core fee-related earnings margin of between 45% and 50% by 2029 compared to 41% achieved in '25. On top of those objectives, we have formulated 2 commitments. Those are to maintain our investment-grade rating and continue to distribute over 80% of our asset management EBIT to our shareholders. So now let's start with the first section of this new chapter. And please join me in welcoming on stage Thomas Friedberger to share his perspective on opportunities shaping the next decade.
Thomas Friedberger: Thank you.
Theodora XU: So Thomas, first question for you, and thank you for being here with us today. What would you characterize -- how, sorry, would you characterize the evolution of global markets today? And what do you see as the most impactful trend shaping the industry today?
Thomas Friedberger: Thank you, Teo. So if we look at the size of the private markets, they were estimated at $26 trillion in 2022. They are expected to grow at $61 trillion in 2032. Those are not small numbers. It's approximately 50% of the current global GDP. And if you want to compare that to other markets, let's say, you have a global market cap today in listed equities of $140 trillion. So this number of $61 trillion expected in a couple of years is not small at all. It means that the private markets are converging with liquid markets and the convergence doesn't stop there. Let me take the example of private credit. Private credit has converged in size with the high-yield corporate bond market and with the leveraged loan market, both in the U.S. and in Europe. That's done already. As a consequence, the fixed income markets are more and more integrated with private credit spreading to investment grade to asset-backed lending. And this will offer a full range of new options to issuers going forward. We also think that, by the way, having a strong expertise in liquid credit through our capital market strategies is a strong advantage in that perspective of convergence. I would also say that in a complex world where uncertainty, volatility, dispersion are increasing, where asset allocators need to deploy large amounts of capital on the back of a strong growth in savings, the one-stop shop model is appealing. Why? Because platforms benefit from clear processes, from clear risk management methodologies, compliance, conflict of interest management, better client servicing, better reporting capabilities. Platforms also are able to source larger transactions, allowing co-investors to deploy large amounts of capital quickly. And they also can afford the multi-local approach, which we think is absolutely essential in the generation of performance. So the message here is that the convergence between public markets and private markets creates value. It creates value for companies and issuers. The increase in size -- in deal size in private equity and private debt provide more options for companies issuing debt. They can allow company to be taken private, for example, or to remain private for longer. It also creates value for LPs. We said that it's allowing asset allocators, large asset allocators to deploy large amounts of capital in private markets. It also gives access to private markets for private investors, which is kind of new. And also, it will bring the best practice of liquid markets to the private markets in terms of conflict of interest management, reporting and risk management. So all of that is positive.
Theodora XU: Thank you, Thomas, for those very interesting insights. We've seen increasing sophistication, sorry, in private markets. What investor behavior shifts are most material? And what capabilities must managers build to truly differentiate and capture growth?
Thomas Friedberger: So if I start with the institutional world, we noticed a sharp increase in demand for co-investments, for SMAs, for bespoke solutions. And that requires from us robust origination capabilities. I mean, capability to originate locally but at scale, which is the challenge. Also solid fund structuring and tailor-made solution to address all the specific demand from all over the world and also robust processes in terms of allocation, valuations, reporting. So that's on the institutional side. And so hence, the importance of the strength of the platform. If I now go to the democratization of private assets, so addressing private investors, it requires from us global distribution channels, so the necessity to talk to a large number of distributors or global distributors all around the world and also digitalization to deliver data-driven client experience and reporting, which we are addressing partially through our Opale platform.
Theodora XU: So as we look to the future now, what structural themes do you see defining the next decade? And where do you see the most compelling opportunities emerging?
Thomas Friedberger: So complex question to answer in a couple of minutes, but I'll try to do my best. We -- so there will be growth in 2026, 2027. But we think we have the conviction that this growth is going to be led by investments more than consumption. So CapEx-led growth, meaning that growth will be probably more concentrated on the sectors that are the priorities of the government. So the famous 4 Ds of McKinsey, Decarbonation, Defense, Digitalization, Deglobalization. We think that the growth will be concentrated with the companies able to enable this to happen. So the sellers of picks and shovels of the resilience, if you will. So aerospace and defense, energy transition, cybersecurity are among those sectors, and that's the reason why we are focusing on them. But let me also consider deglobalization. There is a need in Europe to create European champions also at the SME level. And that is addressed through direct lending because private equity players use 3x more direct lending than capital markets or leverage loans to finance those transactions. And so we think there is a strong opportunity also in European direct lending to build those European champions. Number two, we think that the economic value creation is in the world is switching from efficiency to resilience and resilience has a cost. The cost of producing closer to the consumer, the cost of getting insurance against climate risk, against cyber risk; the cost of operating with higher equity buffers and less debt to cope with COVID-like situations; the cost of having more robust supply chains. So we expect lower growth in the world with high growth concentrated on the sectors I mentioned. It will also probably change the way to invest in private equity. Companies are becoming more asset heavy than before. Even in the tech sector, you look at some companies now own data centers. They were asset-light before their own data centers. Some of them are now building their own electricity production capabilities to feed those data centers. So it will be more asset heavy and probably that the way to invest in private equity will switch towards more what Warren Buffett was doing, which is invest in more asset-heavy sectors, looking more at return on invested capital. And it will not be easy because the best CapEx are done by the best management teams, but you can expect a lot of misallocation of capital also when there is a lot of CapEx in the sector. So probably less reliance on multiple expansion and the investors will need to use less leverage. And if you look at what we've been doing for the last 15 years at Tikehau, it's exactly that. We've invested in sectors that are more asset heavy, aerospace and defense, for example, with less leverage than the average. Third theme is we are entering into a war economy, which doesn't mean hopefully that we will go to war, but which means that all economic agents are put at the service of the priorities of a given government. And that means probably accommodative monetary policies going forward, starting probably in May in the U.S., but also massive fiscal expansion, which means probably lower short-term interest rates and higher long-term interest rates, so steeper yield curve, which is good for banks, which drives the strong conviction that we've been having at Tikehau for years, saying that we prefer credit risk to duration risk. And so from that perspective, we think that direct lending, which is 100% floating rate is very well adapted to this environment, but also, for example, short duration credit in our credit capital markets activities. And last but not least, we think there is a strong opportunity in Europe because Europe is accumulating accommodative monetary policy, massive fiscal expansion in Germany, which will have consequences all over Europe, lower valuations compared to the U.S., lower levels of leverage in the corporate world and the end of the deleveraging of Southern European banks, which probably provides appetite to finance the economy from those banks, not only in Southern Europe, but in the whole of Europe. So a very benign investment environment despite all the European bashing that we see. And so with the condition of being disciplined, there is a very strong opportunity in Europe, where we deploy 80% of our AUMs right now.
Theodora XU: Very insightful. Thank you, Thomas. Last question. In that context, what are the implications for our different asset classes if we go through each of our strategies? And what aspects of our value proposition best position us to capture these opportunities?
Thomas Friedberger: So of course, I mean, it will be all about performance. Performance will drive fundraising. So performance will be key. And for that, we will continue to rely on, one, local sourcing, which is absolutely essential to the generation of performance, but also in terms of risk management, addressing tricky situations locally. Strong corporate culture of alignment of interest and as such, strong investment discipline, which we think we have by DNA and also partnerships to benefit from superior expertise and avoid crowded areas, partnership with corporates, partnership with partners in regions where we are less developed with why not other asset managers. So that's the create, don't compete angle of what we do. Now in terms of opportunities, there are a lot. I will regroup them in 3 categories: growth, value and niches. So in terms of growth, as I said, in private equity, the solution providers through the sovereignty, through the resilience will continue to experience strong growth in a world that will grow at a slower pace. So Aerospace & Defense and decarbonation are 2 strong convictions, and we are really confident there that by allocating our capital well, we can generate a lot of value for investors. In liquid strategies, we are very excited by anything related to the building of European sovereignty, which is a theme which is connected to what I just said on private equity. And on European direct lending, of course, this opportunity to build European champions in the credit space that is growing and is going also more towards larger cap financing with the condition, of course, to have the right allocation geographically and by sector is also a strong growth opportunity. Now value, value being benefiting from low valuations, but also liquidity gaps. We think that here, real estate is the obvious candidate, both in equity and financing, very strong opportunity in real estate with depressed valuations and volumes that are starting to pick up. Private debt secondary is also addressing this opportunity, buying LP interest or GP and LP interest at a discount, being selective is a strong opportunity. Special situations, which we define as financing good companies or good assets with a bad capital structure, so having a problem at a certain moment of their development. There is a lot of things to do in Europe. And with regards to niches, I would mention financial subordinated bonds. Those 3 yield curves will continue to favor banks. It's very European-centric opportunity, but we have a very strong expertise there in capital markets. Asia credit is also something that we want to be involved in. We launched a fund recently, and we think it will be a high-growth area in the coming decades.
Theodora XU: Okay. Very interesting discussion. Thank you, Thomas, for your time. Well, to explore these themes further, we'll now be joined on stage by our 2 co-founders and Maxime Laurent-Bellue, our Deputy CEO, for a fireside chat on accelerating growth across asset management. Thank you, Thomas.
Maxime Laurent-Bellue: Good morning, everyone. Thanks for being here today. It's a real pleasure for me to have this chat with our 2 co-founders gathered in the same place, which is not every day. Today, we will talk about the firm. We'll talk about the industry. We'll talk about the perspective. I want to talk -- I want to start with Antoine maybe -- and I know -- CEO said that we would not do too much history, and we'd rather look forward, but just a quick question to start. It's been a 20 years-plus entrepreneurial journey, which was quite incredible. And I must say I took part of -- a decent part of it, probably around 19 years today and I've seen the firm changing, improving, growing from the startup I joined in '07 to global asset management and investment company with 17 offices globally. So obviously, a lot has happened, and Antoine, in your own words, I'd like to understand what are the sort of key strengths or the key defining features that have been shaping or positioning?
Antoine Flamarion: Thank you, Max. Let's try to capture the secret sauce. The truth is that as all of you know there is no secret sauce, it is a lot of conviction, ambition entrepreneurship, innovation and may be I start with that, we are entrepreneurs, as Max said, as Teo said, the plan is to look forward for the next 20 years. But the truth is that we started, as you know, with EUR 4 million as real entrepreneurs. And the journey has been colorful, complex. There is not a single day when you have (sic) [ haven't ] something new coming up, someone resigning, someone you're trying to hire, a deal going not in the right direction, a financing not in place at the right time, a historical shareholder willing to sell shares. So that's what's happening all the time. But because we are entrepreneurs, and I think a lot of people at the firm became entrepreneurs, maybe some in a different manner. But everybody is putting a lot of energy to make sure we keep the drive, we keep the energy and we innovate all the time. Financial industry is boring. As I keep saying, we used to have banks, insurance company. Now one of the largest European financial institution is probably Revolut, if you look at least on the valuation, $75 billion. Now the banks are trading up, and you've got several banks above $100 billion market cap. But this is what's happening. Revolut was nowhere, now it's $75 billion. Everybody wants to make sure that they put their funds on the Revolut platform. As Thomas mentioned, we create our own digital platform called Opale. It's been a record year last year. So we sell Tikehau funds and other GP on the platform. It's a greenfield. We've started with 0. Hopefully, in a few years, it's going to be several billions. And we started that again from scratch. So part of the secret sauce has been innovation. And you can innovate in this boring industry either on the way you raise money or the way you invest. We discussed earlier, Mathieu mentioned secondary private credit. We've been the first firm to launch secondary private credit in 2020 in the U.S. Secondary private equity was everywhere, but secondary private credit was really new. Now we raised our second vintage. We are accelerating on this front. And we've been doing that all the time. When we launched direct lending in 2009 in Europe, it was popular and well known in the U.S., but nobody was doing that in Europe. Defense is a very good example. And I think there were a question online we did not answer earlier about the deal flow when it comes to Aerospace & Defense. It's multibillions coming, and we launched that in 2020. So I think part of the journey, and I don't know if it's the success or not, but we've been innovating all the time. We're going to keep innovating. And you can innovate, as I said, on the asset or the liability side. When you partner with corporation, nobody in the industry has been partnering with corporation. When it comes to Aerospace & Defense, you know our partners, Airbus, Dassault, Thales, Safran, they put money, they sit on some of the committee. They help us analyze some of the company. And as a result, since 2020, we own 35 companies in the sector. We exited already 3 of them, reaching on average 2.7x multiple. You partner with these guys, you're probably ahead of the curve. When you launch decarb with Total and we launched already the second generation, again, you partner with Total that gives you an edge of understanding the sector, the trend. Does it make sense to look at hydrogen? Yes, no. Battery storage? Yes, no. And we've been doing that all the time. Max has been part of the team, who a few years ago, start investing and financing data center. We've done that a while ago. We sold one in the Netherlands in December. Because we are born in France, everybody know Mistral, the French AI company. We've been the one financing their data center. And I think it's been all the time for more than 20 years. So we're going to continue to innovate. Hopefully, that will generate more businesses. We will create more partnership with financial institution, with corporation. And it's a very long answer because as I said, there is no secret sauce. We are entrepreneur. We innovate. We keep the same pace. As some of you know, we put a lot of energy, we being the 715 employees are putting a lot of energy to make sure we make things happening. And that's going to be the same thing. But if you look now for the next 20 years, now we have 17 offices, a very strong platform, a very talented pool of people, and we see a big acceleration coming.
Maxime Laurent-Bellue: And so it's interesting because innovation and partnerships have been at the foundation of our journey and sort of interconnected together. Should we expect obviously more innovation and more partnership?
Antoine Flamarion: Yes. I think it's we've been -- I don't know if it's good, but we always find, Thomas mentioned, niche, a very specific thing because when we launched Decarb, it was a niche in Europe, frankly. When we launched Aerospace & Defense, now it's super popular, but it was not even a niche. It was -- nobody wanted to touch that. And I think we are looking all the time at what's happening in the financial service industry, and we look at traditional asset manager, Schroders is a good example. We look at alternative asset manager. We look at insurance company. We look at digital company. And you could expect more innovation, more partnership because that's how we build the firm. And I think now the partnership we can achieve are probably much bigger in terms of size than what we've done before.
Maxime Laurent-Bellue: Thanks, Antoine. Mathieu, I'd like to move on the more the industry. In the same period of time, obviously, the industry has transformed rapidly tremendously. Thomas touched on the growth of the market, how the market and participants have been increasingly sophisticated, more players coming in, more competition, I guess, more strategies. So it's in constant movement. I'm not even mentioning the backdrop, which is obviously quite complex right now with geopolitics, tax and so on and so on. But how do we prepare for the next growth phase of the firm in that context? And how do we define our approach in this fast-moving environment and fast-transforming industry? It is a long question, sorry?
Mathieu Chabran: It's a great question. First of all, congratulations for coping 19 years with us. I must say I did not realize, but that certainly illustrates that it's an entrepreneurial and it's a people business journey. But I mean, think about where we started and what -- when you joined us in 2007, what the -- I don't even think that alternative asset management was defined as a term. We barely talked about private credit that really was born on the ashes of the GFC, I mean, certainly in Europe. We were still very much in the GPLP world. I mean, if you look at the -- we were born in Europe, as Antoine said, not to mention France. And the market was extremely defined. It was the GPLP, you were doing mid-market European buyout. We were barely talking about private credit, as I said. You had some real estate managers for sure, but even real estate was not really perceived as, I think, an alternative asset class. That was probably certainly in Europe, the most advanced and most developed asset class that was -- that people could address and not to mention infrastructure, et cetera. Fast forward 2026, the name of the game every day, you read in the press, you see in the media are these juggernaut platforms. I mean, I can name them because they've been modeled in our development, the Blackstones, the Apollos, the KKRs managing more than $1 trillion. I mean we like to use this anecdote with Antoine. When we started in 2004, TKO with EUR 4 million of assets under management, Blackstone was managing $40 billion. And he was sitting at Goldman Sachs. I was at Merrill Lynch over there, and we were like, well, $40 billion. Fast forward today, it's $1.5 trillion, $1.6 trillion, the getting or something, and it's only starting. So this transformation of the industry which has accelerated over the past 5 years, it's complicated to date that. But you see that there is this massive transformation of increased savings on the one hand, private savings, bank, insurance, regulation, which is now very different in Europe than it is in the U.S., interest rate structure in some part of the world, I can think of Japan, I can think of others. And this globalization phase, which all of a sudden enter a deglobalization phase because maybe there is this cyclical moment with the U.S., where you're constantly on the edge. It's like being on a rugby playfield, right, and waiting for the information and seeing where the ball is going to be coming from, where we're going to have to play defense, to play attack. And that has been extremely exciting as far as I am concerned, we are concerned. And we've only been able to do that because we were lean, agile, that obviously, our team, our people were fully embarked in this dynamic. And that's why we're so -- I am certainly, I guess, we are, Antoine and I, are so excited about what's ahead because I can tell you that when people ask us what have you done differently? Well, maybe starting with $50 billion and not $4 billion with 17 offices and not just sitting in our seller in Paris. So we're at this crossroad now where we can tackle an industry that has been, as we said, changing dramatically, which I must say, has been somehow dominated by American brands, platform franchise, which once again, I respect greatly, but the world is in a different place now. And I think you cannot have some limitation on goods with tariffs. You cannot have some limitation on people movement with immigration and not have at some point some limitation on the most liquid assets, which is capital. And what we're seeing right now, which is rightly the point that Thomas made about sovereignty and the real defining investment that needs to happen right now, there will be a massive opportunity for platform like us. We've been seeing all along that you have to be multi-local, which means that when you're addressing Europe, and we're all seeing in London today, but I can see in the room, many people coming from different places. And we all know that doing business in Madrid, in Milan, in Frankfurt, in Paris, in London, it's different. The culture is different. The rural -- I mean, the legal environment is different. The networks are different. And we've been making this investment for the past 20 years. When we're talking about harvesting, that's what we are referring to, that TKO today is deeply rooted in every single market to be able to size, to execute, to monitor, to -- sometimes to restructure this situation. And that's what investors or certainly the 80% of the investors we've been referring to that we are now trusting us, that's what they are looking for. I'll give you an anecdote. When we started talking to Korean investors 7 years ago, -- and you spent a lot of time there. We all spent a lot of time there. I remember 7 years ago that some of them in our direct lending, for example, strategy, they were asking specifically to carve out Spain and Italy because back then, we were coming out of the euro crisis, the peaks, the whatever. Over the past 12 months, all the capital we raised in the region has been for private equity investment in Madrid and in Milan because it's moving so fast. And what those people are expecting from us is to be the local guide with the skin in the game, not just selling them the product of the months, but effectively promoting some investment strategy where there are some strong conviction at heart, but with capital aligned to them. And so here, again, a long answer, but I've never been as excited because the platform we have to tackle this new chapter in the market where effectively there is a dominance like in many other sectors by some of our U.S. friends, there is this, I guess, once in a lifetime for us opportunity to be this next-gen native European alternative asset managers, which has grown organically across asset classes with capital fully aligned. We might discuss later on M&A or something, but not trying to build artificially a one-size-fits-all platform, but to have a real bespoke and hopefully relevant, performing, as Thomas said, offering for those investors. So long answer, but I think we're best -- that's why we wanted to have this discussion with you now because I think the platform now is mature. It's mature to be harvesting these opportunities.
Maxime Laurent-Bellue: Thanks, Mathieu. Shorter question now for Antoine maybe. We've -- I think we've sort of outlined a bit of the road map for the next few years earlier today. I want to be very specific, Antoine, on what would you -- and if you could elaborate on our key priorities. We mentioned scale. We've mentioned profitability. I'm sure underwriting is one of them as well. But could you give us your vision on that?
Antoine Flamarion: Thanks, Max. Maybe I will start using what Mathieu described as harvesting. We've been investing for the last 20 years, building the platform. And we consider that the platform, which is multi-local, 17 countries, strong local investment team is fairly unique, meaning that we can source a lot of local opportunities. And when it comes to private assets, you're not buying assets behind your Bloomberg. You need to be local. So we started doing, I don't know, a lot of residential, for instance, in Portugal, in Spain, in Germany. And as you know, real estate market is very difficult, now we start seeing really big guys, almost all the sovereign wealth fund coming, knocking at the door to say, we want to co-invest with you in your residential expertise. And I think that's exactly the illustration of harvesting. We invest in the platform. We can source fairly unique assets with a very strong risk-reward profile. And that's about now the time to make sure we do -- we deliver a larger transaction. We keep the same investment discipline. And at the end of the day, it's not about growing the AUM. The most important thing is making sure you deliver performance for your LP, for your investor and as a consequence for the balance sheet and your shareholder. And I think now for this chapter, we're going to be focusing on more profitability at the fund level, at the firm level because we've been investing for 20 years. So now the operating leverage is much higher. We reached EUR 150 million of EBIT 19 years after launching the asset management. The asset management has been launched in 2007. After 19 years, now we reached EUR 150 million, and it's exponential. So I think now it's about time to harvest to make sure we increase the profitability. We need to be very selective in a very changing world. The example of Mathieu is clearly what's happening. 7 years ago, people will tell you, please, no Spain, no Italy. And now people will tell you, you're doing too much France. We want to do really Italy and Spain. And it's changing all the time. When it comes to real estate, people have been obsessed by buying retail real estate, office real estate. Needless to say, what the office market looks like now. So we need to continue to adapt. So I will say to answer and summarize what I say, scale, operating leverage, profitability, investment discipline and keep the same ambition, and that's the plan.
Maxime Laurent-Bellue: What about M&A, Mathieu? -- we are -- as we discussed, we are well capitalized. So we are a potential buyer for not anything, but for many objects. The industry has been consolidating recently. How do you -- do you think we'll be active? And how do we assess the right match essentially?
Mathieu Chabran: Yes. That goes back to what we were saying. I mean there is this imperative of scale right now, be in terms of footprint, size, assets and strategies, platform. And whilst there will always be the great and perfect investors very focused either locally or by industry. Clearly, the trend that we've been seeing over the past few years is accelerating and we'll be -- I think we'll be even more impacted by the cost of doing business, from a regulation standpoint, from a -- as I said, the footprint you need to have. And we are very well positioned. I mean, it's going back to some of the question we had earlier on about the balance sheet. The balance sheet has been a huge enabler for the asset management business, as Antoine addressed. It's always been as entrepreneur, you're never overcapitalized. It's quite often very the opposite. And so having this opportunity to be able to buy, seed, merge, sponsor, we've become the partner of choice for many bankers, some of you in the room, and I'd like to call on you to give you some evidence. But I mean, I think today, we've got 85 names in our spreadsheet in the pipeline of situation that we are looking at, small single strategy, single country platform all the way to some of the large platform that traded recently. And we have become partners of choice because of this balance sheet. I mean if people just want to sell, cash in and move on, that's not the type of things we're looking at. But people say, okay, now we need to have a stronger partner that can seed anchor the next phase of fundraising, the next fund to be fully aligned in the mindset and the culture and see the cross synergy we can have in the distribution, then the discussion becomes highly interested. Obviously, the -- I mean, the starting point is that there needs to be -- I think the first and foremost is the cultural fit. I think it goes past the financial merits. And now that we are 5, 7 years into some structuring M&A., I think that some of them will demonstrate that the cultural fit was not there, and there could be some issue there. So I will always put culture first. Then it has to be about the complementarity, obviously, because there will be little merit for us to be doubling up on some strategies where we are already a market leader in a market or in a strategy. And then it has to be financially accretive, right? The last thing we want to become is an asset aggregator because that comes back to the discussion we are making about -- we are having about the -- our earnings. It has to be a profitable growth. And so that -- when you put all that as a filter, it leaves from 100, it gets you maybe 10 situations, right? And from 10 situation, there's maybe only 3 you want to do and maybe one that will conclude. But we believe that M&A will keep -- as a general comment, M&A will keep developing, certainly in Europe, where some platforms are subscales, partly for some investors. We also discussed the fact that many asset owners, they are reducing the number of relationships that they're working with, but they are increasing the amount of capital they are allocating to. And that's something that we can benefit from now that we are at scale. And the other thing, I don't think we commented on this KPI and Vincent tell me if I'm off beat here, but I think we're still at 2/3 of our investors, LPs are invested into more than 2 strategies. So they will be into credit and private equity, into infrastructure and real estate. And that's something this cross-selling and the upscaling that you can have with your LP, that's where you can make obviously a big difference. So it's about being very selective.
Maxime Laurent-Bellue: And on that, Mathieu, I was actually thinking probably even more selective than in any of our strategy, right? Because you certainly don't want to misunderwrite an investment in credit, in PE, real estate, but you, for sure, don't want to misunderwrite an M&A opportunity, right? Because...
Mathieu Chabran: 100%. 100%, it's -- it's a people business. You have not seen us entering into transformative M&A that with all due respect from our investment bankers friends in the room, what I call sometimes the bankers idea, which is on paper, on XL, it's always perfect. It always works on XL. And then you've got this people business component that needs to be factoring. But as the industry mature, as some people get into some succession challenges, as some platform may be struggling to raise the next fund, those discussions are becoming very interesting.
Antoine Flamarion: Maybe I'm adding a comment on M&A. All the transactions you've seen in the sector, all the comments are about how many times what's the multiple on FRE, okay? BlackRock is buying HPS on whatever, 17x. Collier has been purchased on 17x and so on and so on. Our view is that we should be focusing on the underlying fund and not the FRE multiple at the management company at the GP. Because at the end of the day, the value of an asset management business is the underlying performance. And I think people have been a little bit distracted in the last 15 years. So people have been buying a lot. As you noticed, we bought nothing. And we are in a position whereby we will be the one consolidating. But as long as we make sure that we are buying a very strong team, the same DNA and culture and very strong performances at the fund level because if you start having good performances, the value of your business is probably close to 0. So we're going to remain disciplined. We look at a lot of situation. And thanks to the balance sheet and our shareholder base, we can -- if we want, if it makes sense, be acquisitive. But no doubt that we're going to be very, very cautious. And we see -- we start seeing more and more opportunities coming. And as the cycle change, which is the case, for instance, in private credit in the U.S., there are more and more people knocking at the door. So we are really well positioned if we want, if it makes sense.
Mathieu Chabran: And an extension to your question, Max, is it doesn't just have to be an M&A deal. It can be all these partnerships where we've been, as Antoine pointed out, I think, pretty good at with some corporates, with some financial partners, with some asset managers. I think that, that's going to be increasing. And when we were detailing the fact that moving forward, you have this asset management pillar, this balance sheet pillar on the asset management level, we become a partner of choice for those partnerships, partly with more traditional insurance companies, I can think of, with some other asset owners who are looking for some ways to deploy more into certain strategies. And that's also a step forward where our track record of having this partnership will certainly resonate well with this at this time in the cycle.
Maxime Laurent-Bellue: Thanks. I'm conscious of time. So maybe before wrapping up, 2 questions, 2 final questions on each. Maybe starting with Mathieu. What would you say -- what would you like to preserve the most? Or what would you like to never change within the firm regardless of where we go, how we grow?
Mathieu Chabran: Yes. Well, Put this little movie there. And obviously, we're in a particular seat on [indiscernible] because it was the 2 of us and now it's 700-plus people, we are working with. It was in a small office in Paris, and now we're on the road all the time, meeting with all our teams and colleagues and partners locally. I think it's close to 50 nationality we've got across the platform now. And this -- I no longer want to use the word DNA, but I think this culture, the singularity that we tried to develop over the years and still maintain that makes effectively hopefully, a small difference between similar platforms is certainly what we need to be focusing on. And when I look at the breadth, the expertise, the wealth of the people working around us, I mean, that makes a huge difference. Because at the end of the day, as Antoine said, what we do is not rocket science. But for as long as you are fully aligned, that you are fully embarked in terms of the people that are working to, then you can make effectively a difference in good and bad times. And you will know very, very well, you personally and many of our people that sometimes sitting at an investment committee, sometimes we don't even have to talk looking at each other, people because having been through all these cycles together and that might be the benefit of now time and experience, it makes a huge difference in the way you're approaching what is at core, as Antoine said, the investment, the risk underwriting, the fact not to be forced to doing something or -- I mean, each time we did something wrong was when we got to live into the former. And for as long as we can resist that because the people, we've been in the locker room together. We've been on the pitch together. We had the fight, the win, the losses sometimes, but we came back, that's what we need to preserve for sure.
Maxime Laurent-Bellue: Is it difficult...
Mathieu Chabran: For sure. For sure, I said.
Maxime Laurent-Bellue: Is it difficult something to combine ambition, growth with maintaining entrepreneurial spirit, nimbleness?
Mathieu Chabran: Just to share maybe with the audience, I mean, where I'm really, really happy is that today, our team, our senior leadership team, our partners, they're spread across all our offices from Singapore to New York, obviously, here in London. And that is something that has also been a key differentiating aspect where you need to obviously hire locally, but you need to maintain this backbone, this what is the culture of Tikehau and hopefully, the discipline too.
Maxime Laurent-Bellue: Antoine, you opened, you closed. Any key message, any key commitment maybe for our partner, shareholders, investors?
Antoine Flamarion: Talking about commitment, we've been committed to this business with our 715 people. We are very committed. We remain entrepreneurs. Mathieu mentioned DNA. It's still the same company with the same drive, the same energy, a more global platform, a longer track record because when you start, you have not a real track record. Now we can claim that in several strategies, we have a strong track record, a solid track record. The world is becoming more and more complex, and we mentioned sovereignty, technological changes, geopolitics, politics. It's going to continue to be like that. So we're going to keep diversifying our business from a geographical point of view, from a sector point of view. We need to adapt the firm. I mentioned Revolut, our own platform, Opale. We launched several initiatives called either Retina or Lagoon, which is our own AI tools. So we need to adapt all the time because we are not really AI or tech native. So we had to spend time. We hire younger people specialized in this area. So it's going to be the same. We still have a lot of appetite. We are not going to do stupid things. We discussed briefly M&A. We've got very strong conviction globally. We could be -- and I don't want to be arrogant, but we could be discussing U.S. asset management for 2 hours is there. We spend a lot of time there. I'm not telling you that we are announcing in the next 10 minutes something in the U.S., but we are looking at all of our options. We've got these 2 very solid businesses, the balance sheet with permanent capital that everybody is looking at. 10 years ago, you talked to some people in the GP industry, they said, we're going to enter permanent capital. And we said we have a EUR 5 billion balance sheet. And we've got this now profitable asset manager. So we're going to have the 2 businesses, making sure they are both highly profitable. And we're going to keep doing the same thing with the same drive, same energy with a very strong group of talented people internally and a very -- and I finish here, a very unique set of partners, corporate partners, financial partners. We did not really discuss today. But as you know, some of the largest families around the globe are invested with us from the U.S., from Greece, from France, from Italy, from Netherlands. And that's also part of our cloud. So more or less the same. with a little bit of new innovation coming.
Maxime Laurent-Bellue: 23 seconds over time, I think that's fine. Thank you so much.
Antoine Flamarion: Thanks Max.
Theodora XU: Thank you very much, gentlemen, for this very interesting insight. Before delving into our final sections, beyond strategy and expertise, what truly defines us is the way we operate. Our entrepreneurial spirit is not confined to our offices. It shapes how we think, how we collaborate and how we challenge ourselves. So we'd like now to share a short video that captures this spirit in action. [Presentation]
Antoine Flamarion: We just do cycling, FRE, net income, that's the real Tikehau. It's a cycling and sport company.
Henri Marcoux: Just got down from my bicycle. Good morning again. Yes. So we'll be finalizing this presentation, starting maybe a quick introduction in terms of compounding effect and velocity focus. We wanted to remind you a few data points. First one, there was a question earlier this morning on our balance sheet, asset-light. We wanted to remind you a little bit the way we've been using our balance sheet, how have we been operating over the last years. Here, a quick snapshot once again on our investment portfolio. A few take away. First one, a significant increase of our investment portfolio went up from EUR 1.6 billion back in 2017 to EUR 4.4 billion as we speak. Second takeaway, the way we've been rebalancing this investment portfolio. Earlier back in 2017, it was allocated 33% through our strategies. It has gone up roughly to 80% in '23. End of '25, the allocation to our own strategy stands at 69%. And that's actually a direction we want to keep on going, which means actually having lower intensive allocation to our investment strategies. So what have we been doing with our balance sheet? A few examples have been given this morning. But obviously, investment in our own strategy, we've been mentioning that. We put our own capital at work. We invest alongside our LP, alongside our partner that enables us to effectively have a compounding third-party fundraising, accelerate international expansion. On the other way, investment in all our ecosystem, as we've been doing in the past, to forge partnership, complement our expertise and structure co-investment. We'll be coming back on the 2 first pillar. So first one, Tikehau Capital strategies. EUR 4.3 billion have been committed in our own strategy. As you can see, credit has represented most of this allocation up until now, 48% out of that 18% in our CLO platform, which, by the way, has enabled us to launch effectively 24 European and U.S. CLO since we started the business. Alongside that, launch as well vintage and new flagship and adjacencies. Another 17% of allocation has been done through real estate and a significant part of our allocation of this EUR 4.3 billion has been carried out in private equity, roughly 36%. And all the initiatives that we've been talking about up until this morning, decarbonization cyber security, aerospace and defense, all these initiatives that were launched back in 2018 have been done, thanks to the allocation initially made by the balance sheet. One important point. We've been talking about this kind of third-party fundraising compounder. You can see here, each time from 2018 to 2021, that we were putting EUR 1 from the balance sheet, we had a kind of a multiple of by 7 of third-party inflows. Since '22, so during the last -- latest fundraising cycle from '22 to 25, this multiple has increased to 13. Several aspects to that. First, it's true that once the flagship are becoming bigger, once vintage are more advanced, for example, which is the case on vintage on direct lending, the multiple is higher. So clearly, we've been demonstrating that this fundraising companying effect was very efficient. Other key priorities already that was announced this morning as well as co-investment the use of the balance sheet is a key asset for effectively in this co-investment opportunity. We are using the balance sheet to warehouse partially some of these co-investments. That was the case back in '22 on this first private debt secondary initiative, more than EUR 500 million. It has been the case last year on several co-investment deals in real estate, in private equity, in private debt. We mentioned the deal in Spain, EYSA. So here, clearly, you can see that this warehousing capacity and use of the benefit is clearly playing a strong role in our business model. Now switching to ecosystem and direct investment. I won't come back -- won't belong on that, EUR 1.4 billion. But once again, here, it's a kind of full ecosystem, which clearly this full network is expanding deal flow. It is deepening expertise, and it is clearly enhancing market intelligence. So we are partnering here with 56 GP, 60 LP interest and it's providing a huge diversity around investment type, geography coverage or sector coverage. Antoine, do you want to provide a comment on that as far as our GP relationships are concerned?
Antoine Flamarion: One thing we -- thank you, Henri. One thing we try to do is build relationships around the globe and long-term relationship across asset classes, geographies, sector. And we've been using this balance sheet in what we call ecosystem to generate opportunities. It could be co-investment opportunities when it comes to private equity, to private debt, to real estate. It could be financing, and you've got 2 examples here. We co-invested 5x with J.C. Flowers doing financial services all around the globe. So for instance, when they invested into BTG Pactual a while ago, when the bank was private in Brazil, we co-invested with them alongside GIC. More recently, we invested with them in Jefferson Capital. We just conducted an IPO. And for us, it's 2x realization, but the multiple is close to 8x now after the IPO. And so we generate within our ecosystem long-term relationship with families, with financial institution with very strong GP. And that's part also of what I described earlier as the cloud. Tikehau is not only 17 countries, 715 people. It's several families, several really big and smart investors. And I think when I keep doing that, that will generate more opportunities and also that's avoid you to do mistakes. When you partner with some of the smartest investor in the financial service sector, it could be Flowers, but we've done things with Stone Point, which is the other big investor in the financial industry in the U.S. Then you're a little bit smarter, if you look at a leasing company, at a private equity company, at an insurance company and so on and so on. And that really illustrates the DNA of Tikehau. It's not only one firm, one culture, one P&L., it's a cloud of partners all around the globe, which enable you to find smarter opportunities, avoid mistake and accelerate when it times to accelerate.
Henri Marcoux: And what's the takeaway you're going to tell me? So here, we've provided a few data points, both from listed ecosystem investments. Realized proceeds now are amounting above EUR 1.5 billion, net MOIC 1.4x, that's a 13.2% net IRR. And as far as exited investment -- co-investments are concerned, that's more than EUR 270 million of realized profit and 2.3x net MOIC. So once again, here, you're demonstrating quite demonstration of what we've been achieving over the last cycles have clearly demonstrated strong returns within our business model. Do you want to provide a comment or we can...
Antoine Flamarion: Yes. No. We had the opportunity to discuss a little bit earlier our investment in Schroder. But as you know, we've been using our balance sheet to invest in the financial services. Back in 2012, we bought Salvepar from Societe Generale. In 2017, we were the second largest shareholder of Eurazeo with a 9.5%. So we are always screening the entire financial services industry. When it comes to Schroder, which is probably -- which was the best name in the city of London with a very unique business, size, very strong track record. The company has been under some pressure and as a consequence, valuation was very bad. So we decided to do 2 things: one, to become a relevant shareholder falling more than 5.4% of Schroder, but also building a relationship with them, trying to be able to create products, increase our distribution channel and we are still discussing with them on opportunities. And suddenly, a U.S. investor came almost 2 years after we made the initial investment, decided to launch a takeover. And that's, for us, is generated close to EUR 240 million of P&L, a very strong return. And we use the balance sheet to really do 2 things: deliver good investment and generate business. And that's part -- that illustrates perfectly what we've been doing for 22 years.
Henri Marcoux: So now moving forward and looking at the next 4 years, the next chapter, what are going to be our allocation policy to -- as far as balance sheet is concerned. We are now exiting this phase where, as we mentioned, balance sheet was a growth enabler. We are entering into this next phase where our balance sheet will be strategic allocator. Our priority will be now probably to deploy less, rotate faster, target higher velocity and more value-add opportunities. So what -- no change here. Balance sheet allocation will be gearing forward Tikehau Capital strategies and ecosystem. As far as Tikehau Capital strategies are concerned, obviously, we will keep on going and we will have still strong skin in the game alongside our partners, but a focus will be reinforced on value-add strategies in PE, in real estate and in credit, with expected returns over 15%. And as I mentioned previously as well, greater flexibility, notably on co-investment. On ecosystem, similar pattern, strategic transaction, focus on high-performing investment and ancillary business. Three main objectives, very clear: improved portfolio velocity, generate increasing profitability and grow shareholder return. I mentioned lower capital intensity into the funds. If you have a look at the 2 previous cycles from 2018 to 2021, average yearly allocation in the funds was roughly 450 million a year. Since last cycle from '22 to 25, it was roughly 450 million, but including co-investment, the allocation will still be -- keep on going within co-investment and secured capital fund. But once again, lower capital intensity expected on this new cycle coming. We mentioned profitability and this next phase with a strong objective. Clearly, 3 main pillars will be enhancing our profitability them for the coming years. First one, operating leverage, and I'll be giving you in a minute the details of that. Performance-related earnings will be the second pillar on which we will be relying and investment portfolio. Operating leverage, we are exiting this cycle '22-'25, where we have reached EUR 28 billion. We are now targeting more than EUR 35 billion for this next chapter in the coming years. So clearly, here, more selectively adding -- we will be more selective in adding adjacencies and target new initiatives. We will be more focused clearly on scaling existing strategies. How are we going to achieve that? Once again, by deepening institutional relationship, high-growth region such as APAC, Middle East, North America, and we will also broaden our distribution, like was mentioned before by Antoine and Mathieu, notably to capture more private wealth demand. What will be the growth driver? You have them here, but clearly, all of them will be clearly used and all the structure that was developed over the last 20 years, the 17 offices and the setup in place will be clear in this new target to once again achieve more than EUR 35 billion -- EUR 34 billion of fundraising for this new cycle. Operating leverage once again here, I think that we have demonstrated that over the latest 2 fundraising cycle, operating leverage has already taken place. So Asset Management EBIT moving from EUR 4 million to EUR 114 million at the time of the latest Capital Market Day back in '22. Since then, reaching EUR 150 million, as we have described this morning. So that's a 52% CAGR since IPO. And once again, this sustainable growth has been supported by mix improvement and scale efficiencies. In that context, new chapter will be focused on reinforcement of this operating leverage, and we will be harvesting in this new phase. We are now targeting both between 45% and 50% of core FRE margin by the year 2029. Second pillar of this new phase of profitability of this new phase of development will be performance-related earnings. We've been repeating that for many years, strong value embedded within the underlying value, the underlying funds, shareholder allocation, more than 54% of allocation of this carried interest to the balance sheet, significant profitability driver. We've seen that during the year '25, by the way, it was the highest year in terms of performance-related earnings, EUR 22 million. So we mentioned this morning, this EUR 220 million of unrealized performance-related earnings. That's the picture -- how the picture looks like at end of September '25. So that's the underlying carried interest, which are being valued at fund level. We are expecting more than EUR 160 million to be maturing before the year '29. So we are here providing you a kind of a data point where we think the timing of this EUR 220 million where we think it will be realized. By the way, that does not include any additional value creation that can be created between '25 and the next coming 4 years, which will potentially create additional carried interest. Third pillar of this new chapter. We mentioned operating leverage. We mentioned performance-related earnings. Third one will be investment portfolio. And here, we wanted to provide you a data point. Sorry to be a bit technical on that. But in terms of how do we recognize within our P&L, the return of the fund. So up until now, all of our funds in which the balance sheet was invested have obviously been realizing capital gains. They have been disclosed underlying stake and cash has been returned to the balance sheet. However, we want to assess that up until the DPI is below 1, it does not create any P&L impact at our balance sheet level. So up until now, we have effectively some cash flow, but no P&L impact. As we are exiting the G-curve (sic) [ J-curve ] of most of our flagship and as we will be entering over -- DPI over 1, we are expecting significant P&L effect from our balance sheet and thus the new -- the kind of new forward looking that we are providing today as far as net result profitability is concerned. I was mentioning this G-curve (sic) [ J-curve ] effect once again here, 2 key decisions, 2 new allocations that are being discussed today. First, allocation in new investments which are allowing higher velocity. And second one, exiting J-curve for existing investments. These 2 elements will clearly drive this third pillar of the investment portfolio. Important data point as well on investment portfolio. Since the IPO, 2 clear cycle, 2018, 2021, '22, '25, these 2 cycles have so far returned -- have generated more than EUR 1.6 billion of capital return to the balance sheet. The next cycle that we are facing from '26 to '29, we are expecting an increasing return of capital for the balance sheet roughly above EUR 2 billion for the next 4 years. So which means that all the investments, once again, the investment portfolio that we have been describing together a few minutes ago, will generate more than EUR 4 billion of return of capital for the balance sheet. But how we're going to use this EUR 4 billion and we had the question earlier today, new investment within our fund, balance sheet optimization and shareholder return. Talking about shareholder return here, providing you a few data points, our historical dividend distribution history since IPO. We are reiterating today our guidance, which is effectively a strong commitment to distribute more than 80% of our Asset Management EBIT per year. And meanwhile, we are providing you this new guidance on Asset Management EBIT for '26 and as well for -- up until '29, notably reaching this 55% to -- 45% to 50% core FRE margin. So I hope that all this point, once again, are illustrating this next phase of development, once again, based on these 3 pillars clearly identified and described together. Antoine, Mathieu, maybe I will let you the floor for any conclusion remarks, if any, or otherwise, we can open Q&A.
Antoine Flamarion: Thank you, Henri. Just commenting on the last slide on the dividend. As you noticed, we've been 2x since the IPO paying exceptional dividend. If we continue to deliver strongly on the balance sheet return, we'll probably have excess capital because as Henri described, we need to put less money into our asset management funds. So we could expect probably in the next cycle to make sure that we improve the return for shareholders. Shall we take some questions? Yes.
Theodora XU: Let's take some questions. So several questions from the room. Question from RBC.
Unknown Analyst: [indiscernible], RBC Capital Markets. The first one on fee-related earnings margin development. Can you share more color on what sort of cost discipline assumption underpin margin expansion as you continue to scale? Second is on secondaries. Perhaps you could expand on what is your longer-term ambition for these funds? And how competitive do you expect the secondary space to be over the next few years as your listed peers -- well, some of your listed peers are actively pushing to accelerate growth there. And then lastly, on AI and specifically, if you observed any material impact on your cybersecurity mandates? Also interested to know how you distinguish between AI winners and AI losers within your investment process?
Antoine Flamarion: Thank you for your question. Maybe I take the first one on operational margin. I think we have a slide on basis points per management fees per asset class, if you can show that. As everybody know, there is a strong pressure from management fees in the traditional asset manager, which get totally disrupted by the ETF business. When it comes to private assets, we continue to preserve the management fees, if I may say. And if we can get the slide, you will get a sense. But overall, our management fees remain a little bit stable, declined a little bit, but we have our private equity increasing in terms of size. And as you will see on the slide, the private equity management fees is improving. We're at [ EUR 177 million ]. So 1.77 percentage management fee last year. We are above 1.85% management fees. So when it comes to revenues, we think that revenue will increase because of the private equity is increasing at TKO in terms of size and businesses. When we look at credit, there is some -- it's not pressure, but our average management fee is declining because we are issuing more CLOs and CLOs, the management fees is lower than the direct lending of the secondary private debt. But overall, we managed to keep the same management fees. As Henri pointed, we have more performance fees. We noticed that in 2005, with a 5.4 basis points. So when it comes to revenue, to answer your question, revenues will continue to increase. We are fairly convinced of that. Henri mentioned it, we start managing the cost. The first phase was really the growth phase. We open offices. We hire people. Now we are becoming much more cost conscious. So that means that operating expense will probably be managed in a better way. And as a result, that will lead to an increase in the margin of our Asset Management business.
Mathieu Chabran: Yes, I'm happy to take the one on the secondaries. So when we decided to launch the private credit secondaries, which is what we are focusing on right now, that was in the context of our opening in North America in New York. And when we discuss with our partners, with Cecile here who's leading our direct lending practice, we say, okay, I mean, what would be the differentiating angle for us to be another direct lender in the U.S., which is already highly populated market, and that was 7 years ago. That was even before what's going on right now. And we came to the conclusion that after this very solid and robust cycle of primary allocation to private credit over the past 10, 15 years, similar to what had happened to private equities and the development of secondaries private equity, there will be a natural opportunity to provide liquidity to some LPs allocated to the asset class, we would be willing to rebalance their portfolios. And we thought that we were best positioned to do that because we were not a secondary solution provider like many of our competitors can be and that's their positioning. But we were credit investors at heart. And so we could demonstrate the merits of doing the underwriting, using our balance sheet as Henri just told you, and that's how we launched this practice. And what was perceived in 2020, like a very cyclical opportunity that was right in the middle of COVID, people were throwing away their financial assets became very quickly a structural strategy. And today, as some of our competitors and some more established names started to develop there in a matter of 4 years, it has become an asset class on its own. As Antoine said, we just closed our second vintage. So we now have more track record than some of our competitors to demonstrate the merits of the strategy. We've been allocating a lot of our own balance sheet. We've been using the balance sheet. The example that Henri was saying earlier, I can elaborate on that. Our first fund was shy of $500 million. And then came an opportunity to buy a portfolio, actually a single asset, but a portfolio from a Taiwanese insurance company was getting out of a Goldman Sachs mezzanine fund, a very large $15 billion trend, which we're already an LP with. And we knew the credit and we knew that in order to do that, we could not do that with the fund. Or by the time we would go and pitch our LPs, "Oh, are you interested with this co-invest?" The opportunity would be gone. So that's where the balance sheet is the most differentiating asset. And that's why today, we're trying to once again convince you that it's not a burden. It's our most valuable assets, enabled us to underwrite that, get these assets at some very attractive financial terms. And then once you have secured this opportunity, bring on some LPs, including some Hong Kong-based insurance companies, European insurance companies and turn this balance sheet capital into third-party fee-paying asset management. And so today, as we close the second vintage at $1 billion in our capital, we are convinced, as I said earlier, that not only it's a natural evolution when you're in the private market to find some liquidity and add on top of that, the little noise that we've been having for the past few weeks, we would expect this to increase. And today, when you look at all the competitive landscape of our friends, all the managers, it's probably $20 billion that has been raised by way of funds or SMAs and the opportunity set in front that is $100 billion. And those are public private pension funds, insurance companies, family offices, who are rebalancing the portfolio. And we like the situation where the supply demand is totally unbalanced because that's where you become a little bit of a price setter. And as a consequence, I mean, today, we saw public numbers where we're disclosing our fundraising, the close to $2 billion that we have deployed there have been both at $0.84, $0.85 a dollar which on an average, 3, 3.5 years remaining portfolio, you're creating a 500 basis point pickup for this illiquidity. If you remember, in secondary private equity during COVID, when interest rates were at 0, the secondary market was trading at a premium to NAV, because that's when people were like, if I can deploy overnight some capital instead of having -- we had some negative interest rates, if you remember, having some cash at the bank was costing me some money. So obviously, in some more defensive downside protected credit investment that we can underwrite in a bottom up, we like the risk reward and that we can generate effectively some mid-teens return. That's the return that we've been generating so far, which ticks exactly the type of return on equity we're going to have for the balance sheet.
Henri Marcoux: You had a question on AI and impact on our cybersecurity business. Difficult for me to comment on. I'm a bit puzzled to say the list on AI winners and AI losers. I've seen some companies that are dealing with food premises and so on being AI losers and suddenly having decreasing value. So trying to understand that. I will not provide further comments. All I can tell is that our cybersecurity business, we are currently operating the fourth vintage. We had strong demand from investors and the size of fund #4 has roughly doubled. And by the way, meanwhile, something is currently happening over the last years, notably since '22, which is clearly called sovereignty. And I think that there's a clear here, a new environment, new paradigm where people are realizing that it's key. And I can tell you that within our portfolio, we are the biggest venture cybersecurity business with this fund in Europe. We are a shareholder of a company called ChapsVision. It's a global data treatment. All its systems are being used by the European government. Some may call it the European Palantir, but clearly, this company is growing significantly. We are a shareholder of Memority, which is a company providing data access to local information system locally or at distance. And I can tell you what we are seeing is strong business growth in all this company because major -- many companies in Europe are trying to replace and to be less dependent from the U.S. on all these sectors.
Theodora XU: [ Isabel ] from Autonomous.
Unknown Analyst: [ Isabel ] from Autonomous Research. So I have 2, please. My first question within the context that I understood from the full year '25 results session that you expect FRE operating expenses to be broadly flat year-on-year. So first of all, correct me if I misunderstood there. But given this, we are seeing a number of your global peers move aggressively into Europe, both institutional fundraising and on the private wealth side, including lots of hiring of dedicated sales teams to push distribution. So how are you thinking about reconciling the need for operating cost control against maintaining or expanding your competitive positioning and market share? And then my second question is on PRE. Thank you for the color on when you think it's going to mature. On the EUR 160 million that you expect to mature before 2029, should we expect that to be more back-end loaded towards 2029? Or could we see a substantial share come through this year, please? I appreciate that might be hard to predict, but maybe if you could set out some parameters, do we need a certain fund to do very well or a couple of disposals should trigger that first recognition?
Mathieu Chabran: So -- go ahead...
Henri Marcoux: You know that performance-related earnings. I don't have an Excel spreadsheet with every month for the -- it will obviously depend on from value creation and exits. So obviously, internally, we are -- we have all of our underlying EUR 600 million position that we are hosting on PE private debt. We are working on some kind of forecast, but difficult effectively to provide you data, strong data sets, either by year or by quarter by quarter.
Antoine Flamarion: But maybe what we can say is that the figure you saw here, the EUR 220 million, it was the same figure 2 years ago, if you recollect. And we had in between for the 2 years, EUR 40 million. So we'll receive EUR 40 million, EUR 22 million this year and a little bit less in 2023. So we still have the same EUR 220 million. So that means that our AUM base is growing. Our eligible AUM base to carry interest is growing. As you know, we try to be conservative on that because you cannot really predict PRE. What we can say is that we are building more and more private equity exposure, which will generate probably more carried interest than traditional real estate or credit. When Henri and Vincent highlighted 2.6x multiple on exit on private equity is generating more carried. So I think we are very optimistic, very difficult to predict because it depends on the market, on your asset where you're going to exit. But we are fairly confident that, one, it's growing, and it's highly diversified because secondary private debt is another example where we're going to get carried interest as well. So that means that we are diversifying our pool of carried interest, difficult to predict, but it's improving, and we are very confident on that.
Henri Marcoux: And if I make co-investment carried interest are obviously quicker than fund carried interest.
Antoine Flamarion: And maybe if you go back to your first question on -- regarding retail, one of the firm motto is create, don't compete. 30% of the money we manage is coming from retail investors directly or indirectly. So we've been pioneer in France with unit-linked product. We launched with our partner, Intesa 4 years ago, a very big program. We've done the same thing with our partner in Abu Dhabi, First Abu Dhabi Bank. We just signed something with the largest bank in Singapore. So my comment is that we still have 30% of AUM coming from retail investor. I mentioned large family offices that are investing directly with us. So do we need -- to go back to your question, do we need to build a giant sales force to tackle the retail? We are not convinced, and that's not what we're going to do. We see our peer group in the U.S. hiring hundreds of people to cover IFAs, banks and so on. We are fairly convinced that we can keep growing there without adding gigantic cost, number one. Number two, we'll try to be more digital. So we create our own platform, Opale, which is already fully operational. It's not gigantic. But in 2025, we raised EUR 260 million through this channel, and it's a greenfield. So we don't think we need to add a lot of resources. Our competition is doing the other way around, and they have larger brands than us, the U.S. guys, not the European guys. But we are fairly convinced that it will not destroy the profitability of the asset management.
Mathieu Chabran: Maybe to preempt a follow-on question, which is all this retail focus by many, we've been fairly constant and public on that. We thought that there might have been a bit of misselling in trying to address this market with open-ended evergreen structure. And I'm not only reacting to the headlines over the past few days, but there's been -- I don't want to name anybody, but there's been some things on the real estate happening, how can you have some daily liquidity when you're owning 25 building a city of London, how do you want to offer the liquidity to your clients? On the private equity, the same thing and some of the Boost funds have grown exponentially because obviously, you had a very good brand, a good track record. And some people may have said, and it's not about the managers, sometimes the distribution saying, "Oh, you can buy this private equity or have a debt fund, it's like buying European equity usage". Well, it's not the same thing when it comes to liquidity. And our conviction is that you rarely die of your assets, but very often of your liabilities. And that's a risk that is now in the market that don't want to be overreacting to some news flow. But part of what we show you, we have out of the EUR 52.8 billion, we've got EUR 200 million in an open-ended structure with a targeted return of 7% to 8%, when the other people are showing a low teens because of the leverage, [indiscernible]. So we are looking at the technology. We want to make sure that we can address and tackle the opportunity, but there will never be -- that we will never compromise with the asset liability matching that we believe is what we owe to our customers.
Antoine Flamarion: And there are some products whereby you don't really need a specific sales force. So we have -- we launched one unit-linked product with our French partner, Societe Generale. It's a unit-linked product dedicated to aerospace and defense. And for the first 2 months, it's been EUR 1 million per day more or less. And it's not our sales force. It's really the sales force of the bank. So we don't need to add extra people to market that.
Theodora XU: Question from Nicolas Payen from Kepler.
Nicolas Payen: Nicolas Payen from Kepler Cheuvreux. First one on net inflows. Just wondering, what kind of environment assumption have you baked in, in your in your planning when you set up your net inflow targets? And also, if you could give us a bit of color regarding the kind of asset class mix you're expecting regarding net inflows until 2029. That's the first question. Then the second one will be on balance sheet investment returns. Thank you very much for your comments regarding the acceleration on the G-curve (sic) [ J-curve ]. Just wondering what kind of return shall we expect on the -- in the balance sheet? If I remember well, last time, you mentioned something like 10% to 15% return on balance sheet investments. So wondering if that still holds.
Antoine Flamarion: So maybe when -- I start with net inflows. As Mathieu, when he started, highlighted its fourth year in a row record year when it comes to fundraising. If you look at the net new money, the EUR 8 billion we get or the EUR 10.5 million gross, it's now really coming from all around the world and still 50% is going into private credit. But within private credit, it's highly diversified between secondary private debt, direct lending, CLO and so on. So my point here is that we try to diversify as much as possible. As business owner, you want to build a very diversified business. So now that the platform is fully operating, we're going to expect net inflows coming from all around the globe. For the first time, we had a reinsurance company invested EUR 500 million with us in 2025. 12 months ago, we never came across this investor. We had a German reinsurer company investing EUR 350 million with us in 2025, first time. Large Japanese insurance company invested EUR 200 million in 2025 in a direct lend fund. So to illustrate that, the net inflows will come from all around the globe. We will probably benefit from the geopolitic at some point. So I'll give you one of our favorite topic Canadian pension fund, which are by far the largest, probably similar to the super annuities in Australia. They used to put all their money with the large U.S. GPs. Now they want to find European and Asian GP. So going back to your question, the net inflows will really come broadly from all the geographies, number one. When you look at institutional investor and retail, we commented a little bit earlier, but we keep build the infrastructure, the technology to attract retail investor. It will also come on specific asset classes. So as everybody know, real estate has been very difficult for a lot of people around the globe. We've been very acquisitive in 2024 and 2025. So we start reinvesting in real estate because we see very good opportunities. So I suspect we're going to be the one benefiting from this shift back to real estate. We are not commenting and giving the exact breakdown of the 2029 in terms of asset classes breakdown. So that would be my question -- sorry, my answer on net inflows, maybe, Mathieu?
Mathieu Chabran: There's one -- it's an anecdote, but I kind of like it. Q2 '25, so a year ago, we raised more in Latin America than we raised in France. And for me, it was an interesting anecdote because I've never been there. Antoine has never been there. We've got our colleagues covering Peru, Chile, Mexico from Madrid. And by working this market over the past 2 years, now we're starting harvesting at a time with some -- our domestic market. So that's where this complementary comes. And this harvesting concept we've been reinforcing all morning, it's really about that, that we made the investments because our CapEx, our OpEx, and now you're starting to have the investment payback.
Antoine Flamarion: Maybe your second question on balance sheet return. Our goal is to make sure we continue to deliver mid-teen returns. We've been a little bit trapped into J-curve, as Henri described. So the way we are allocating the balance sheet moving forward is probably in a much more cautious manner. We have still the same target. And by the way, we build the firm being good investor at building the balance sheet. I like saying that, but we started Tikehau as an investment company in 2004. And it's only 3 years after that we launched the asset management. And the asset management has been able to grow from EUR 4 million EBIT to EUR 150 million of EBIT because we've been seeding the strategy and investing. And we are investor before being asset manager, and I think we're going to be very disciplined and probably much more disciplined than when we were before. I'm not saying that we are not disciplined. But now it's really the time of harvesting and the investment committee managing the balance sheet called the Capital Allocation Committee is becoming much more difficult, for instance, when internal teams are knocking at the door to say, yes, we have a new strategy. We want to -- we want -- sorry, to launch a new fund dedicating to cycling and we are targeting 7%, but the likelihood we take the piece of paper, and it's going directly in the shredder is 100%. So when it comes to balance sheet, investment and balance sheet return, we're going to stick to the same mid-teen return, which is going to be a mix of stuff because asset classes are different, but that's what we target. There's -- sorry go ahead.
Mathieu Chabran: Last point is going back to your first question. There's no dependence on one market -- sorry, on one geography or one asset owner type for a fundraising. Now it's really broaden. And the same thing you may have picked up this morning in the detailed report we issued. Last year, our real estate fundraising on our open-end trends and our CMS fundraising was actually very modest to say the least, which historically have been very strong engine of growth. So obviously, those are open-ended, but you should expect a significant pick up there, too.
Antoine Flamarion: He wanted to say engine.
Theodora XU: Questions from Julian, ODDO BHF.
Julian Dobrovolschi: I have 2. Perhaps the first one is on the core FRE guidance that you gave. Just wondering if you could speak about the drivers for reaching the upper end of the range, so that will be the 50% kind of think about the building blocks. So what would be the step up from 45% to 50%? And the other one is, if you could also say something about the potential gaps that you've identified in the operation model, so perhaps strategies, niches and that you'd like to develop or I think using Antoine's words, innovate, as you enter in this new growth cycle.
Henri Marcoux: On the core FRE margin, I provided earlier the 3 main drivers. Obviously, we have the mixed effect driving the core FRE margin. We have, in terms of revenue, the pace of co-investment as well as an important feature. The more we are able to structure co-investment with additional revenue will be as well impacting that. And then you have on the other way around, obviously, all the cost initiatives. And here, we will be most -- we'll be more cautious, notably on extending any geography or extending any services. So difficult to assess in terms of timing, but we are clearly seeing something like 50% could be achieved depending on the pace on deployment on these 3 drivers.
Antoine Flamarion: And probably, it will depend, as you know, on the business mix. So if we have more private equity coming, obviously, the operating margin is improving and the plan is really to keep growing at a faster pace our private equity. If you think about it, at the IPO time, we had no private equity, a part of balance sheet investment. Now we are getting close to $10 million of private equity. So in a difficult market because nobody has been waiting for us, private equity is suffering a lot, but the margin will be depending also on the pace of our private equity expansion.
Henri Marcoux: But if I may add on private equity, I think you mentioned it, but I think we are the only one to have such differentiating factors, notably this partnering with industrial. We are relying on these 2 vein transition -- energy transition, decarbonization on one hand, aerospace and defense on the other hand. And on both strategies, we've been partnering with the biggest knowledgeable people in the industry, and that provides a key differentiating factor.
Antoine Flamarion: Going back to your question on innovation, we really built the firm innovating, and it's been asset class. It just was Henri described, people doing private equity have been generalist. We decided to be specialized just because we said that we're not going to be another LBO shop. So we decided to be vertical. We are studying various vertical right now. So you're going to see us innovating. We want to make sure while we innovate, we are doing stuff we understand. So we don't expect to be active in cryptocurrency or we're in a stick to what we are good at. Its sourcing good opportunities that we understand. We have a lot of idea and we keep having a lot of idea. What changed probably is that we want to make sure that when we launch a new strategy, it needs to be really scalable. In the past, we thought that we had great ideas. So for instance, my colleague will kill me, but we launched something called Tikehau Green Assets, which was an amazing idea, an amazing team, and we have EUR 130 million into the fund. And I must say that EUR 130 million is totally subscale. So we want to make sure that while we innovate, it needs to be really scalable, above EUR 1 billion for sure and potentially make sure it's multibillion.
Mathieu Chabran: You should see, I guess, some extension or, let's say, adjacencies. So when launching, let's say, CLO, CLO is a very scalable, but commoditized product. When we launched in the U.S. 4 years ago, we had been operating in London since 2015. The CLO pool in the U.S. because of the nature of -- and the structure of the market is running twice as fast, and we're scaling. We're now pricing our CLO #8 in 4 years when we had 15 in London. When we launched direct lending in Asia, that's because we think that we're getting to the point with the right partnership, the right shareholders the right investors to effectively have these adjacencies of a first fund, a first move that then we'll be able to scale. As Antoine said, our very first direct lending fund in 2007, so it's almost 20 years now, it was EUR 125 million. The last vintage, #6 that we just closed a couple of weeks ago is passed EUR 5 billion. So you get effectively -- all that is feeding of the operating leverage and the operating margin that we were talking about. You should see us expanding in real estate in North America. We've got a 20 billion real estate platform in Europe. We're managing public REIT, private REITs, commingled funds, open-ended funds. There is an opportunity right now that the natural extension into real estate bid debt or equity is made, I wouldn't say, at marginal cost, but it made at a phase in our development that the drop-through is also feeding your bottom line. So that's where you would see some -- you will see some natural expansion of the platform.
Theodora XU: Maybe I'm conscious of time. One last question from this gentleman from [indiscernible].
Unknown Analyst: I have 2, if I may. First one is share price, very strong execution, very strong everything, but the share price does not reflect it. So how far is this management team willing to execute its tools in order that the market recognizes its intrinsic value because I think the market is not nearly recognizing the net asset value of its balance sheet. And the second is strategies for risk mitigation for the first of the French government of taxing and everything. So what ideas when we see all competitors, sometimes they have other jurisdictions to make their tax not go higher and higher. So thank you very much, and thank you for the strong execution.
Antoine Flamarion: Thank you for your question. Share price, needless to say, not only because as we are the largest shareholder because we still control the employees still control 54% of the firm, we get very frustrated as some of our shareholders. So I think to cope with that, a few things. One, we need to make sure we keep executing and it's painful because you execute and your share price is not moving. So if you look at the slide I like on the EBIT, you started when you lease the asset management was EUR 4 million EBIT. Now it's EUR 150 million. Let's forget everything, okay? I'm launching a new company. I give you a business plan, and I'm telling you that 9 years from now, I'm going to reach EUR 150 million of EBIT, everybody will tell, okay, this guy smoke something because you cannot move from 0 to EUR 150 million of EBIT. So we're going to keep delivering on the profitability of the asset management. And I think it's really accelerating, so that's number one. Number two, the balance sheet, and that's why on purpose, I put this slide, we have really 2 businesses, which are very different. We use the balance sheet to launch the asset management to see to accelerate. But we are fairly convinced that the sum of the 2 balance sheets, the sum of the parts, if I may say, is probably twice at least where we trade now at EUR 16. So we're going to try to keep delivering. But also at some point, if we are not able to move the share price, and it's not only, I think, hopefully, us, the sector, it's also mid-market stock market in Europe is a little bit broken. So at some point, it will come back, and we start seeing a lot of U.S. investors coming to buy European shares, not only doing takeover as Nuveen on Schroder, but we start more U.S. guys coming. So hopefully, it will change the market because we need the market to change. But I must say that if we are not able to change the stock price just doing a regular job and probably increasing the payout for the shareholder, we may took more, I don't know, structural changes. And we already simplified the structure when we listed, as everybody remember, we had a [indiscernible] structure. We simplified the group. So now we are clearly saying that we have 2 businesses. And I'm not telling you that we are going to split the company in 2 companies. But we want to make sure if you are listed that the stock price and the stock performance is working because when you travel the world, everybody is looking at your stock price, you pitch a Korean investor for your direct lending. The first thing he's doing is Google, stock price, flat a little bit down. What these guys are telling me to deliver a lot of performances at their fund level. But -- so we are all on top of that. We are spending a fair amount of time. Now as the asset management is more profitable, I think it's going to be much more easy for us to change that.
Mathieu Chabran: There is plenty of structural optionality. I guess that's part of the message we wanted to convey today. I mean we've always been a long-term greedy in making sure we can demonstrate and execute because when you start from 0, 5, you have to show over a cycle, a few cycles that you're delivering, which I'm convinced we are doing. And the rest should follow. If it does not follow, there are some structural optionality.
Henri Marcoux: Now your question on France is a key question. We're going to face election...
Unknown Analyst: [Foreign Language]
Henri Marcoux: In a few months, we are -- I mean, we are dealing with it. And -- but difficult to comment, but we are dealing with it.
Antoine Flamarion: And that's why, I think I mentioned it 2 times already, but we make sure we build a very diversified business in terms of asset classes, geographies, both on the asset and the liability side. So we want to make sure we raise money all around the globe, and we want to make sure we invest more or less everywhere in Europe, but also Mathieu mentioned North America, we start doing more and more real estate because real estate is a mess. So we took advantage of that being contrarian. And at the end of the day, we're going to build a global diversified business. And it's changing all the time. The perspective, we discussed Spain and Italy, 10 years ago, when we opened -- so this year -- sorry, in 2025, it was the 10-year anniversary of our Italian opening in Milan, okay? People at the Board of Tikehau told us 10 years ago, "you're opening in Milan. Are you crazy?" And now everybody is going to Milan. So that's why, once again, create, don't compete. We have very strong conviction. France remain France. It's one of the largest countries in Europe when you look at economic footprint, innovation. And so we're going to continue to do stuff in France, but maybe the way we allocate is going to be more diversified.
Theodora XU: Well, thank you so much, everybody. Thank you to the speakers, to the audience today for your engagement. We can continue our discussions in a more informal manner with a light cocktail. A big thank you to the IR team that works in the shadow. And thank you very much, and we look forward to build this next chapter together. Thank you.