Carlyle has closed its fourth special situations and distressed fund after raising $2.5 billion in capital commitments, the firm said.
The New York-based asset manager has more than tripled its total commitments reached by its predecessor vehicle, which hit $703 million, according to PDI data.
The fund is a 2015 vintage and has attracted commitments from both the California Public Employees’ Retirement System and Minnesota State Board of Investment, which have invested $150 million and $100 million, respectively, into the strategy.
Carlyle Strategic Partners (CSP) IV invests across Europe, Asia and North America, specifically targeting companies experiencing financial and operational distress, according to the announcement. The firm is open to investing on both sides of the capital structure, as well as public debt and bank loans.
Ian Jackson, managing director at CSP, said in the statement: “The current global economic and market environment is laying on the groundwork for solid distressed control and turnaround investment opportunities.”
Shary Moalemzadeh, co-head of CSP, said: “We’re opportunistic and we look for the best risk-adjusted-returns that we can generate for our investors.
“Our strategy has been to invest independently of the default cycle. There is always some form of dislocation, whether it’s a company taking on too much leverage or an expansion that has gone wrong. Mis-management is non-cylical. We have a 13-year track record that shows our success in capitalising on these dislocations. And into the future we will continue to invest capital cautiously.”
Carlyle’s credit platform has $29 billion in assets under management and is at the centre of the firm’s ambitious goal of raising $100 billion over a four-year period ending in 2019. The firm’s total AUM stands at $158 billion as of 31 December.
The firm is planning to raise the capital across all of its investment strategies. In addition to its private debt offerings, the firm manages one of the world’s largest private equity investment operations, and also invests in real estate and infrastructure assets.
Last year, the firm collected $14 billion across all of its investment strategies and the firm said it on the earnings call it remains confident it will hit the target as its larger funds return to the market this year.
On the firm’s recent fourth quarter earnings call, chief executive Bill Conway said that Carlyle’s plan is to “build out our global credit business into a world class powerhouse”.
Part of this plan is to scale the European credit business as well as the firm’s real estate debt strategy. Carlyle also has ambitions to increase the size of its business development company.
In November, the firm closed its energy investment fund after attracting almost $3 billion in commitments. The strategy targets investments in subordinated debt products within the energy sector, managing transactions ranging from $50 million to $500 million.
Mark Jenkins is the global co-head of the credit business at Carlyle. He recently joined the firm from the Canada Pension Plan Investment Board and was followed by Ben Schryber, a formerly of First Avenue set to take up a managing director position.