MUMBAI: Edelweiss is set to raise up to $1.3 billion in what could be Indias largest fund mobilization for buying distressed assets.
It has obtained commitments from large pension funds and insurers such as CDPQ and Allianz, two people familiar with matter told ET.Those two funds are likely to invest $400 million and $200 million, respectively, said one of persons cited above.
Besides, Edelweiss itself is expected to put in $200 million.An email sent to Edelweiss remained unanswered until publication of this report.
CDPQ and Allianz could not be contacted immediately.The distressed asset fund could draw interest from sovereign funds in Middle East and Singapore, besides university endowments and pension money managers in North America and Europe.
Some Scandinavian investors, too, may pitch in.Those investors would put in between $20 million and $100 million each, said another source.The fund, likely to be called Edelweiss Stress Asset Fund, may be announced as early as Thursday.The investment is coming at a time when India's commercial lenders are struggling with a huge pile of bad loans.Edelweiss, which manages largest asset reconstruction company in country, is seeking to create a large pool of capital to buy assets at a cheaper price.
At present, Edelweiss manages Rs 40,000 crore of assets in ARC network.The distressed fund is likely to have already deployed one-third of total corpus in buying stressed assets, sources said.
The rest will be invested in new opportunities.Bulge-bracket alternative investors, such as Blackstone, KKR, Bain Capital and Apollo, have either started their own platforms or partnered with large Indian corporates to float funds targeting distressed assets locally.