Bain & Piramal to launch $1-bn fund to acquire stressed assets in India

World Bank's investing arm IFC to put $100 million in the new entity

India Resurgent Fund, a Cayman Islands limited partnership and a joint venture between Bain Capital Credit and Piramal Enterprises is set to launch a $1-billion fund for investing in distressed assets in the country.

The fund's size is expected be $1 billion. International Finance Corporation (IFC), the investing arm of the World Bank, is planning to put around $100 million in the new fund, alongside the sponsors' investment of $200 million; the rest will come through fundraising, according to IFC.

The two Sponsors of IndiaRF, established in 2016 and headquartered in Mumbai, have an equal commitment of $100 million each, with the ability to provide additional funds over and above the commitment as needed. IFC is playing the role of an anchor investor, helping mobilise capital from the private sector and contributing to the structuring of the fund while also providing its stamp of approval.

The fund seeks to resolve corporate distressed assets (DA) in India by primarily making controlled investments. The project is expected to revitalise a number of distressed companies and provide capital relief to banks, helping resolve NPAs in India. It will support the implementation of the new regulatory framework and contribute to a more robust DA market, allowing banks to increase lending.

Founded in 1984, Bain is one of the world's leading private multi-asset alternative investment firms with assets under management of over $95 billion currently. It has 950 employees across offices in the United States, Europe, Asia and Australia. Jonathan Lavine and John Connaughton are its co-managing partners, and it also has over 100 managing directors.

Piramal Enterprises had named Shantanu Nalavadi to lead the partnership with Bain. Reports said that it is seen as the main bidder for Binani Cement. Although the lenders to debt-strapped Binani have selected a consortium of Bain-Piramal fund and Dalmia Cement as the lead bidder, UltraTech has challenged the auction and separately emerged as the preferred bidder for the promoters of the cement company.

Early this year, IFC said that it is planning to co-invest in to acquire distressed and special situations assets in four countries including India through a special purpose vehicle (SPV) formed by Clearwater Capital Partners. The project consists of an IFC investment, under IFC Distressed Asset Recovery Program (DARP), of up to $75 million to invest in distressed and special situations assets of companies operating in emerging markets in Asia including India, China, Indonesia, Philippines, Thailand, and Vietnam.

Since inception, IFC has invested $1.9 billion and mobilized $3.4 billion from investors in its distressed asset platform.

Clearwater Capital Partners, LLC, is an Asia-dedicated distressed and special situations assets investor. Established in 2001, Clearwater is privately owned and has offices in Mumbai, Chongqing, Seoul, Singapore, and Hong Kong. Clearwater has a 15-year strong investment track record through funds dedicated to distressed assets in Asia and as of today, the firm has around $1.3 billion of assets under management.

In December, Altico Capital India Pvt. Ltd, the non-banking financial company of Asia-focused investor Clearwater Capital Partners Llc, invested $195.7 million across five realty deals in Hyderabad and Pune. Altico has deployed more than Rs 85 billion in 100 projects covering more than 100 million sq ft area in seven cities, according to reports.