Vision Global plans $200-million distressed debt fund

Vision Global Investments is looking at launching a $200 million distressed debt fund in the near future. The move comes at a time when a number of other funds in this space are active in India like Clearwater, ADM Capital, WL Ross and DE Shaw.

With the fall in markets and on the back of fears of a downturn in Asian economies, a host of funds are launching distressed funds targeting Asia. Most of the new distressed funds are targeting companies in China, India and Korea.

In case of India, some of them would be BIFR cases or where they have gone through the corporate debt restructuring (CDR) mechanisms. These funds normally takeover the debt from the banks and restructure it through a mix of debt and equity.

Vision Global had recently announced the launch of a $1billion India Infrastructure-focused fund called ‘Vision Global India Infrastructure Fund’. The fund would have its first close by May-end this year and is looking to raise $300 million in its first round. It is looking at investments of $25-75 million through this fund in verticals like roads, airport, ports, urban infrastructure and logistics in the infrastructure space. The fund is expected to provide an average 20-25% return on investment per annum.

Read more in The Economic Times article.

Vulture funds' overtures to SMEs

Can the vulture nurture as well? Perhaps, it can. Distress asset funds (pejoratively called vulture funds) and distress asset arms of global hedge funds operating in India are increasingly beginning to focus on small and medium enterprises, a segment which is the preserve of commercial banks.

These funds are also looking at investing in third generation entrepreneurs, where a split in the family usually means that individual members have to raise capital for their expansion.

Over the past six months, funds specialising in distress assets like ADM, Clearwater, Citadel, Goldman Sachs Special Situations and DE Shaw have invested in such companies, say industry sources. For example, Spinnaker has invested in Spice Telecom and Clearwater in Sanghi Movers and earlier Diamond Cables.

Read more in The Economic Times article.