Capri Global to float $150-mn distressed asset fund for SMEs facing IBC

Capri Global Capital Ltd (CGCL), the Indian associate of US-based fund manager Capri global is setting up special situation fund (up to $ 150 million) in India to invest in medium and small size companies facing insolvency and bankruptcy cases.

It has also set up Asset Reconstruction Company (ARC) and has appointed Sanjay Jain, executive director at CGCL, to head its operations. Sanjay Jain previously was the President and Chief Operating Officer with the Asset Reconstruction Company India Ltd (ARCIL).

The focus of the investment and engagement with distressed units will be on the resolution. The stressed fund would be floated under Alternate Asset Fund class, a senior company executive said.

CGCL’s asset reconstruction arm is in tandem with its aggressive expansion plans to ensure financial inclusion for all.  The asset reconstruction arm will be focussed on resolving issues, from debt to managerial, rather than on acquiring cheap assets.

CGCL said in a statement that it had approached the RBI for a licence two months ago, and the licence is expected to come through in a few months.

According to rating agency CARE Ratings, CGCL which was earlier in the business of debt syndication & advisory. It changed its business model and it is focusing mainly on the lending business. The company started wholesale lending in the beginning of FY12 by disbursing loans to real estate companies.

In the last quarter of FY13, the company started lending to SME firms with an aim to build a portfolio that qualifies for priority sector status. The asset portfolio stands at Rs 22.93 billion as on December 31, 2017.