Chart of the week: Time to invest in distressed

Distressed debt is the dominant strategy for closed-end private debt funds in market.


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PAG launched its debut distressed fund in China, last week, targeting $400 million-$500 million with a first close expected in the next six months. The vehicle will mainly acquire non-performing loan portfolios in China.

PAG is one of a number of fund managers to spot an opportunity in the market. KKR, Oaktree Capital Management and Brookfield Asset Management have also launched joint ventures to invest in stressed assets this year, while Piramal Enterprises has just signed a memorandum of understanding with Bain Capital to invest in restructure situations in India.

Of the $237.64 billion currently targeted by closed-end private debt funds in market, 33.8 percent is focused on the distressed market. The strategy accounts for the highest proportion of targeted capital across the asset class.

Six of the 10 largest private debt vehicles on the road have a distressed focus. Oaktree Opportunities Fund Xb tops this list with a target of $7 billion. Since the fund was launched in September 2014, the firm has already collected $7.74 billion towards the final close.