CPPIB invests $225m in Piramal-Bain stressed asset JV

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The India Resurgence Fund platform (IndiaRF), a distressed assets buyout platform set up with Piramal Enterprises and Bain Capital Credit as joint sponsors, has received a commitment of $225 million from the Canada Pension Plan Investment Board (CPPIB), which manages more than $400 billion in assets.

IndiaRF had earlier raised $100 million from the International Finance Corporation (IFC) through its Distressed Asset Recovery Programme. The platform has also raised capital from other international high networth investors (HNIs) and family offices through the current round.

CPPIB is headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City, San Francisco, São Paulo and Sydney. In order to build a diversified portfolios of assets, the global investment management firm invests in public equities, private equities, real estate, infrastructure and fixed income instruments.

IndiaRF seeks to invest in assets, which are in distress, through the purchase of existing debt and equity securities through bankruptcy courts or directly from lenders, or through newly issued securities; and to take control over the turnaround of such assets through recapitalisation and operational improvements. So far, the platform has invested more than $300 million in India across three investments in Panacea Biotec, Archean Chemicals and Indian Steel Corporation.

“Our investment in IndiaRF represents an increase in our credit commitments in India, targeting attractive risk-adjusted returns in the sizeable Indian distressed credit space,” said John Graham, Senior Managing Director and Global Head of Credit Investments, CPPIB. “Strong partnerships are at the core of how we invest – a strong local operator with active oversight from a trusted global partner will allow us to further increase our investments in India in the long term.”

“The resolution of the NPL problem continues to be an important reform agenda for the Government of India. The Centre and RBI have shown alacrity in addressing the teething issues under the Bankruptcy Code, which has given confidence to international investors. Setting up of an independent judicial machinery has led to efficient resolution of these assets and helped preserve the value of many enterprises. Effective resolution would release capital for banks to fund new capital asset formation, which would in turn fuel future economic growth for the country. We are delighted that following the initial support from IFC to this platform, CPPIB has also increased its existing association with the Piramal Group and its engagement with India,” said Ajay Piramal, Chairman, Piramal Group.