Broad Peak, Brescon ink $300 mn special situations investment pact for India

 Broad Peak, Brescon ink $300 mn special situations investment pact for India

Singapore-based investment management firm Broad Peak has inked a pact to invest $300 million in special situations opportunities in India, along with stressed assets advisory firm Brescon.

The duo will scout for deals across buckets of turnaround, debt resolution and litigation financing, among others, the companies said in a joint statement.

“Brescon has a strong reputation in the arena of stressed/distressed debt in India and we look forward to working with them and other stakeholders in those domains,” said Broad Peak managing director Sandeep Gupta.

Brescon founder and managing partner Nirmal Gangwal said that the arrangement with Broad Peak is a precursor to the company’s ambition of raising a dedicated special situation fund. He did not specify if Brescon is separately raising another fund or intends to revive its previous plan to do so.

Brescon has had ambitions of getting into asset management for the last few years but its efforts had come unstuck previously. It had earlier mulled a plan to jointly float a $1 billion stressed asset fund led by Piramal Group. But this plan did not fructify. Later, Piramal teamed up with alternative investment major Bain Capital for the project.

Two years ago, Brescon had hit the road itself to raise around $200 million fund. It is not clear if the latest deal is part of the same umbrella. The firm did not make any fresh announcements about the proposed fund. It is likely that the firm scrapped this plan, too.

The Broad Peak-Brescon tie-up is the latest to explore stressed assets opportunities in India.

Last month, Axis Asset Management Company and Inversion Advisory Services, a firm led by Bharti group veteran Akhil Gupta, said they would jointly raise Rs 3,500 crore ($466 million) for a fund that would buy stressed assets.

The fund is seeking to get registered with the Securities and Exchange Board of India as an alternative investment vehicle. It would look to buy a controlling stake in pre-stressed, stressed, and other underperforming assets.

In April, International Finance Corporation (IFC) said it was investing in a fund jointly floated by US private equity firm JC Flowers & Co and India’s Eight Capital, marking its fourth bet on a distressed assets investment vehicle in the South Asian nation.

The World Bank’s private-sector investment arm has committed a total of $100 million (Rs 750 crore), with riders, to the $500-million JC Flowers India Opportunities Fund. Its initial commitment would be $40 million.

Vivek Sinha

The Capital Quest