Fund Managers

OCP Asia raises over $200m for Fund IV – exclusive

The latest of its direct lending fund series, launched late last year, aims at an increasing opportunity in the small and mid-sized end of the market in Asia-Pacific.

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OCP Asia, a Hong Kong-headquartered investment firm, held a first close for its latest Asia-Pacific-focused direct lending fund on 31 March, two partners of the firm have confirmed.

The firm has collected initial capital of more than $200 million for OCP Asia Fund IV, according to Dan Simmons, a partner.

The vehicle, which has a five-year investment period and a seven-year fund life, was launched in the fourth quarter of last year with an initial target of $500 million. The hard-cap size is $800 million.

It will remain open for additional commitments, according to Stu Wilson, a founding partner of the firm. The fund’s target return rate was not disclosed.

Despite the coronavirus-led dislocations in the credit markets this year, OCP Asia Fund IV will follow the firm’s investment strategy from prior vehicles, making senior secured direct lending investments, according to Wilson.

OCP Asia’s borrowers are typically small and medium-sized corporates with EBITDA of $25 million to $125 million. The firm seeks companies backed by sponsor groups or owned by families.

According to a survey, by Acuris Studios, a customised research provider, of 60 mid-market companies across Asia-Pacific in November 2019, more than 54 percent of respondents said their most recent annual revenue sizes were in the range of $100 million to $300 million.

Offering his view on private debt dry powder – sized at $276.5 billion globally, according to Pitchbook data released on 2 April – Wilson told Private Debt Investor that the opportunity set for senior secured lending in Asia-Pacific will increase. OCP Asia is not typically competing with other lenders for deals currently, he said.

The previous fund, OCP Asia Fund III, held its final close on $511 million committed capital in December 2018, according to PDI data. Montana Board of Investments and Arizona Public Safety Personnel Retirement System were among the investors in the fund.

It is understood that OCP Asia’s assets under management is sized at more than $3 billion as of 31 March.