London-based Emso Asset Management Ltd. is teaming up with venture capital firm Eight Capital Management LLC to launch a fund of between US$300 million and US$500 million to target India's corporate restructuring market, The Financial Times reported, citing unnamed sources.
The investment platform will pursue 10 to 15 restructuring deals involving companies with annual revenues of up to US$100 million, targeting a gross internal rate of return of 25% to 30% over a five-year period. Investment sizes will range from US$30 million to US$50 million.
Blackstone Group LP, Apollo Global Management LLC, Lone Star Funds and JC Flowers were among the global investors that have formed funds with a similar strategy in India.
The Indian restructuring market boom was spurred by a bankruptcy code that is part of Prime Minister Narendra Modi's economic plan and his anti-corruption drive, the publication noted.
As of the end of March, declared bad debt at Indian banks amounted to US$141 billion, according to the report.