According to an official statement, the investment is Allianz’s first private debt commitment in the stressed assets space in the country.
“Institutional investors are increasingly looking at private debt strategies in the country more than ever before. We are confident that this partnership will enable Allianz to make the best of private debt opportunities,” Edelweiss chairman and CEO Rashesh Shah said.
Edelweiss has been trying to capture the stressed assets space in a big way. Last month, it announced the closure of its distressed assets-focused fund EISAF II after raising $1.3 billion. Edelweiss had raised $77 million for its first distressed fund in 2010.
This is the second partnership for Edelweiss with a global institutional investor in stressed assets and specialized corporate credit, after Caisse de depot et placement du Quebec (CDPQ), one of North America’s largest pension fund managers.
For Allianz, India is a growing area of focus. In November last year, Allianz partnered with Warburg Pincus-backed ESR Group to establish a logistics investment platform in India, with an immediate equity commitment of $225 million. The capital was be funded on a 50:50 basis by Allianz Real Estate and ESR, and will subsequently be converted into a $1 billion AUM platform.
“Asia plays an important role in the global portfolio allocation across all asset classes. The investment with Edelweiss fits well in our allocation of alternative investments in the country,” said Allianz Investment Management’s chief executive officer and CIO (Asia) Ritu Arora.
2018 was a record-breaking year for private equity investments in India’s stressed assets wherein till mid-December, the space attracted investments worth $828 million, a massive jump from barely a couple of million dollars each in the preceding two years, according to Venture Intelligence data.
“The partnership with Allianz comes at a time when there is a need for long term capital in India. We believe that with the constraints faced by banks and NBFCs, there is a huge opportunity for private debt managers,” said Venkat Ramaswamy, Executive Director, Edelweiss Financial Services.