HONG KONG/NEW YORK, Could 8 (Reuters) – Bain Capital is in search of to lift $4 billion for a brand new world “particular conditions fund” because the U.S. agency sees a possibility to snap up distressed and fairness investments, two folks accustomed to the matter mentioned.
Bain Capital kicked off the fundraising firstly of the yr and has already raised about $2 billion for the brand new fund, mentioned the sources, who requested anonymity as these discussions are confidential.
The agency is focusing on a ultimate shut of the fund by the tip of the yr, the sources added.
Bain Capital declined to remark.
In 2020, Bain Capital arrange a earlier world fund after securing $3.2 billion in commitments. This system was beforehand referred to as Bain Capital Distressed and Particular Conditions Fund and used to take a seat inside Bain Capital’s credit score enterprise.
Bain Capital’s particular conditions technique is now a standalone enterprise, after being carved out with an unbiased workforce exterior the umbrella of the credit score unit.
As a part of the technique, Bain Capital has adopted extra flexibility on deploying capital and is investing in asset lessons together with fairness, distressed property, mortgage portfolios, company investments, and actual property.
Whereas dealmaking involving buyout companies has slumped this yr as a result of a difficult atmosphere, distressed funds have accelerated fundraising efforts over the previous few years in anticipation of a downturn following a chronic interval of financial enlargement.
World buyout offers totaled $139 billion this yr, down 62% from the identical interval a yr in the past, Dealogic information confirmed. For the reason that starting of 2020, distressed funds have raised about $115 billion globally, in line with information from Preqin.
DISTRESSED INVESTMENTS
A mixture of rising rates of interest, inflation and a regional banking disaster is driving up default charges, pressuring margins, and making a liquidity crunch in monetary providers, thus offering alternatives for distressed buyers.
A string of buyers, together with Oaktree Capital Administration and MidOcean Companions, have been advertising new particular conditions funds since final yr, focusing on troubled industries and credit-strained firms, in line with PitchBook.
In April, Diameter Capital closed a $2.2 billion particular conditions debt fund, which information supplier Preqin on the time mentioned was the most important of its type up to now this yr.
Globally, Bain Capital’s particular conditions technique has $16 billion of property underneath administration.
For the reason that launch of the technique in 2002, Bain Capital Particular Conditions has invested over $28 billion in additional than 850 offers throughout North America, Europe, and Asia Pacific, in line with its web site.
Final yr, Bain Capital closed a $2 billion particular conditions fund for Asia Pacific to cowl a spread of asset sorts, which included a give attention to actual property.
Reuters reported on Friday that Bain Capital can also be nearing the ultimate shut of its fifth and largest Asia-focused fund after having raised round $6 billion from world buyers.
Reporting by Kane Wu in Hong Kong and Anirban Sen in New York; Enhancing by Sumeet Chatterjee and Sonali Paul
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