Edelweiss raises $425 mn for latest Special Situations Fund, targets $1 bn corpus

The fund has received commitments from global investors, which include large insurance companies and pension funds as well as HNIs and family offices from India. The fund is targeting to raise $1 billion, with a green shoe option of $500 million.

Its previous fund–Special Situations strategy Fund (Series II)–invested over ₹10,500 crore across deals and has also exited several transactions and realised more than ₹9,500 crore from portfolio companies. The Special Situations strategy focuses on asset heavy companies and identifies viable underlying businesses that EAAA believes, have a strong turnaround potential and invest in situations where resolution of assets requires capital and domain expertise.

Special Situation Fund (Series III) has already invested more than ₹1,000 crore across two transactions.

“Special situation opportunities provide an exciting avenue for generating superior risk adjusted returns for investors. The Fund strategy caters to both corporates looking for specialised financing solutions to turnaround their business fortunes as well as financial institutions looking to sell / resolve their existing portfolio assets. Acquisition Financing under bankruptcy process is also emerging as a good opportunity set. We believe that the Investors in special situation strategy can generate high returns, akin to equity, while mitigating downside risk as large part of fund investments that are made in the nature of covenant-heavy credit instruments,” said Amit Agarwal, head, special situations strategy.

Edelweiss Alternative Asset Advisors has built one of the largest domestic alternatives platforms with an AUUM of $5 billion ( ₹40,000 crore).

“The high-yield / special sits market in India continues to grow rapidly as requirement of flexible and patient capital is felt across industry segments,” said Venkat Ramaswamy, Vice Chairman, Edelweiss Group.