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Commitments to Indian distressed debt funds surge

18 Jun 2014

indiaPrivate equity firms are raising funds to invest in distressed assets in India following the election of Narendra Modi as Prime Minister to capitalise on the country’s expected economic turnaround.

Apollo Global Management recently raised an $825m fund in a partnership with Indian bank ICICI, while Tata Capital Private Equity and Edelweiss Financial Services are currently seeking cash, said Bloomberg.

That fund has made investments of INR3bn ($50m) in engineering business Jyoti Structures and INR9.6bn and INR4.5bn in pharmaceutical company Avantha Holdings and commodity business Mercator, respectively, Preqin data showed.

Commitments to Indian distressed debt funds soared to $1.74bn this year from $70m in the whole 2013 and $4.78bn.

“Foreign funds have a chance to play a bigger role in the turnaround of assets that have become distressed given their capability and expertise,” International Asset Reconstruction managing director Birendra Kumar.

“Growing interest from abroad for taking a active part in India is a good sign.”

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