Centrum Alternative Investment Managers Ltd, the alternative investments arm of Centrum Group, has marked the first close of its maiden fund at Rs 155 crore (approximately $21.82 million at current exchange rates), the company said in a statement on Monday.
Mumbai-based Centrum said it is looking to raise Rs 500 crore for the Centrum Credit Opportunities Fund, along with a greenshoe option to raise another Rs 250 crore.
The new vehicle will invest in performing credits as private debt in mid-sized Indian companies in high growth, consumption-led and core economy sectors.
The fund will have a four-year tenure with a two-year extension option, the statement said, adding that it is aiming to generate an internal rate of return (IRR) of 16%-18%.
Separately, Centrum said the fund has also made its first investment in a specialty chemical manufacturer, placing Rs 30 crore (around $4.22 million at current rates). The firm, the name of which was not disclosed, will use the funds for its long-term working capital, expenditure and realigning its existing debt, according to the statement.
CCOF fund manager and chief investment officer Rakshat Kapoor said there was potential for significant value and opportunity in the performing credit space. “The fund has an active deal pipeline in place and are focusing on providing private credit solutions to companies with scalable business models and ability to generate regular cash flows,” Kapoor said.
Prior to the announcement of the first close, Centrum Alternative Investment Managers made two other investments; the first being a private debt investment worth Rs 155 crore (around $21.82 million) to a financial services company, and the second being a similar Rs 150 crore (around $21.10 million) bet on a water infrastructure company.
Centrum, which was founded in 1997, is an integrated financial services group which provides services in several segments in the larger industry, including equity and debt, equity capital markets, mergers and acquisitions, corporate finance, primary and secondary debt placement and corporate debt restructuring, among others.
Its investment structures for the private debt sector include senior/subordinated debt with or without warrants, convertible debt or preferred stock, payment-in-kind (PIK) preferred stock with warrants, and mezzanine debt with equity investments, according to its website.
