Qualitas Funds Statement on Conflict in Ukraine

Funds of Funds Experts
Lower Mid-Market Experts

Dear investor,


We sincerely hope you are all well. Like many of you, we have witnessed the events in the Ukraine the last two weeks with a sense of horror and sadness. Our sincere thoughts and prayers go out to all the victims of the conflict whose lives have been traumatised by the violence and chaos. At Qualitas Funds, we are searching for specific initiatives to help mitigate the impact of this tragedy, and we encourage you to join our efforts in the coming weeks.

In the meantime, with respect to Qualitas Funds and the potential effect of the conflict on fund performance, while fully aware of the huge social and humanitarian impact of the conflict, we would like to transmit a message of calm. We believe repercussions from the conflict will be limited due to a number of factors:

  • Very limited direct effect from either Ukraine or Russia. None of the Qualitas Funds programme funds has invested in any fund or company based in the Ukraine or Russia or in any of the surrounding countries. We are currently in the process of reviewing our portfolio companies with our local GP managers, but as to date we have only identified a very few companies, of the more than 400 in our programme, that have any exposure whatsoever to either of these two countries. We would expect that total sales from Qualitas Funds portfolio companies to these countries would represent less than 1% of overall sales and thus the potential direct effect of the conflict is very limited for Qualitas Funds.
  • Uncertain but likely modest secondary effect from the conflict. The rise of energy and commodity prices that results from the conflict will no doubt affect companies throughout the economy; we are unable to quantify this effect currently. However, Qualitas has purposely avoided some of the sectors that might be most affected by the crisis, such as the combustion automobile sector or heavy industry. Conversely, as explained in our Investor Day 2021, we actively target those sectors that benefit from tailwinds due to trends such as digitalization, aging of the population, climate change and urbanization. We expect that many of our companies that benefit from such tailwinds will have modest or even positive effects from the crisis.
  • Diversification and low risk lower mid market strategy reduce downside risk. Qualitas Funds exists to provide our investors with attractive returns with limited risk due to diversification. Every fund in our programme targets a portfolio of 150-200 companies, covering 14 or more countries, in more than 6 different currencies. Moreover, Qualitas Funds is focused on the lower mid market in Europe and North America, where volatility and thus risk have historically been the lowest due to low acquisition prices and low debt leverage. Consequently, compared with many other investment products, the performance of Qualitas Funds is relatively uncorrelated with global equity markets and less subject to international events such as Covid or, presumably, the current crisis in Ukraine. Our funds continue to invest and divest their portfolios and results during the first quarter of 2022 have continued to be very promising.

Please do not hesitate to contact us if you should have any further questions or concerns.

Warm regards,


Eric Halverson, Sergio García Huertas and Javier Alemán