Värde Partners to tap into Indian distressed debt market

A new partnership comes amid the manager’s fundraising for its first Asian vehicle, sized over $250m.

Värde Partners, a Minneapolis-headquartered private credit manager, has announced a strategic partnership with Aditya Birla Capital, a Mumbai-headquartered financial services provider. Both parties will evaluate distressed and special situation investing across various corporate sectors in India, according to a statement released yesterday.

Värde Partners has been in the process of raising capital for its first Asian credit fund, Värde Asia Credit Fund, according to an SEC filing released on 1 May. It has garnered at least $258.2 million according to another SEC filing recorded on 20 August.

A spokesperson from the firm declined to comment on how closely linked the strategic partnership is to Värde’s latest fundraising.

“We see India as a core market for Värde and a critical part of our long-term strategy in Asia,” said Ilfryn Carstairs, a Singapore-based Co-CIO of Värde Partners in the statement.

PDI understands that Värde Asia Credit Fund mainly invests across India, Indonesia, Japan and Australia. It is understood that the fund is targeting $500 million and that the firm plans to hold a final closing by the end of September.

The private credit manager held a final closing of its 2016-vintage flagship fund, Värde Fund XII, at $1.74 billion, in March 2017, another SEC filing shows. Among its institutional investors, Florida State Board of Administration, a Tallahassee-headquartered pension fund, disclosed a $200 million commitment to the fund, according to PDI data.

Värde Partners has invested as much as $500 million in India in the past five years across corporate stressed, distressed, special situations and lending assets, the firm disclosed yesterday.

It currently manages $14 billion in assets across real estate, corporate credit, mortgages, specialty finance, transportation and infrastructure assets. The firm expects to open its fifth Asia office in Mumbai by end-2018.

The other partner of the joint venture, Aditya Birla Capital (formerly known as Aditya Birla Financial Services), is a holding company of all the financial services businesses of the Aditya Birla Group, a $44.3 billion Indian multinational, according to a public disclosure as of November 2017. Its business scope includes private equity, corporate lending, structured finance, project finance, general insurance broking among others.

A request for comment on the partnership was not returned by publication time.