Canada Pension Plan Investment Board will invest $225 million in India Resurgence Fund (IndiaRF), a distressed asset buyout platform.
CPPIB, through its wholly-owned subsidiary CPPIB Credit Investments Inc, will infuse money into the fund, which was set up by Piramal Enterprises and Bain Capital Credit.
IndiaRF invests in distressed assets by purchasing existing debt and equity securities either through bankruptcy courts or directly from lenders. The fund also has option to invest money through newly-issued securities.
John Graham, Senior Managing Director & Global Head of CPPIB Credit Investments, said the investment in IndiaRF represents an increase in credit commitments in India and that they are targeting attractive risk-adjusted returns in the sizeable Indian distressed credit space.
The partnership with a strong local operator and active oversight from a trusted global partner will allow us to further increase investments in India for the long term, CPPIB said in a statement.
IndiaRF had earlier raised $100 million from the International Finance Corporation (IFC) through its Distressed Asset Recovery Program. IFC has played the role of an anchor investor for IndiaRF and will use its global expertise, alongside that of CPPIB, to help implement environmental, social and corporate governance standards at the fund.
Helping to address India’s non-performing loan (NPL) problem will have a very significant positive spillover effect on the economy and and will help create jobs, said Mengistu Alemayehu, South Asia Director, IFC.
IndiaRF also raised capital from other international high-net-worth investors and family offices through the current round.