European Commission and EIF invest €30 million to improve financing access for defence SMEs

In a new milestone for Europe’s defence industrial base, the European Commission and the European Investment Fund (EIF) have announced a €30 million investment in Sienna Hephaistos Private Investments S.C.A. SICAV-RAIF, the first private credit fund in Europe dedicated exclusively to small and medium-sized enterprises (SMEs) and mid-caps in the defence sector.

This initiative, supported under the InvestEU Defence Equity Facility (DEF) and funded by the European Defence Fund (EDF), aims to bridge the financing gap that many specialised defence suppliers face, particularly family-owned and innovation-driven SMEs with limited access to traditional bank lending.

Against the backdrop of the war in Ukraine and rising geopolitical instability, Europe’s defence needs have grown dramatically, revealing vulnerabilities in critical supply chains. The new fund will provide tailor-made debt solutions to help companies expand production capacity, build up inventories, and support industry consolidation, directly strengthening Europe’s defence readiness and strategic autonomy.

At its first closing, the fund secured commitments from a strong base of institutional investors, with EIF acting as cornerstone investor. The initiative supports the EU’s broader objective of enhancing the resilience and competitiveness of the European defence value chain by improving access to finance for critical suppliers.

Why it matters for the Greek defence industry

For Greek defence SMEs and dual-use technology firms, this fund represents a new financing channel complementing EU grants and R&D instruments such as the EDF, SAFE and EUDIS tracks. Companies engaged in the European defence supply chain, whether in materials, subsystems, sensors, manufacturing or ICT domains, may explore collaboration opportunities with the fund’s management or partner investors to support production scaling, innovation, and cross-border industrial partnerships.

Stay tuned with EBS

EBS Consulting continues to monitor European defence investment initiatives and supports Greek industries in identifying and leveraging such opportunities, from CapTech participation to EIB/EIF financial instruments and EDF co-funded programmes. Stay tuned through EBS Consulting’s Defence & Security Network (ENS) for ongoing updates, insights and tailored support on accessing EU-level funding mechanisms.

Source

European Commission, Press Release IP/25/2101, 17 September 2025: “Commission and European Investment Fund invest €30 million in Sienna Hephaistos Private Investments to improve access to finance for SMEs and midcaps in the defence sector.” Official Press Release, European Commission