BNP Paribas Capital falls short of €250m goal for special opportunities fund of debt funds, expects full deployment by end of summer

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BNP Paribas Capital Partners has hit a €134m final close for a new European special opportunities fund of debt funds, well below its initial €250m goal.

The European Special Opportunities Debt Fund will aim to back funds holding corporate debt issued by mid-sized companies that have experienced some difficulties or have been excluded from traditional financing channels, the firm said.

BNP Paribas Capital Partners launched the fundraise two years ago, and had hoped to reach a final close in 2019.

Managers selected by the fund will target corporate debt and loans, both performing and non-performing, and primarily tier one within the European financing system.

Debt may be bought on the secondary market or from the bank that has held it since it issue, it added.

The firm said it aims to offer investors an IRR of between 9% and 12%.

ESO has already completed six commitments out of seven in European funds, representing 90% of ESO total investor capital, and the firm expects the investment programme to be complete by the end of the summer.

The firm added that committed funds were invested at around 20%, “providing good visibility while maintaining flexibility to capture opportunities in the market” – and said it anticipates the pace of capital deployment accelerating in the coming months.

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