SG bank DBS commits up to $200m to Muzinich’s Asia Pacific debt fund

Photo: DBS

Singapore bank DBS Group has announced that it will be an anchor investor in US-based investment firm Muzinich and Co’s Asia-Pacific private debt fund.

The bank will invest up to $200 million in Muzinich APAC Private Debt I or 40% of the total fund size, whichever is lower, it said. DBS will also have representation on the fund’s investment committee and advisory committee.

The transaction is in line with the group’s strategy of investing in new revenue and growth avenues arising from special situations opportunities created by the pandemic, DBS said in a statement.

Muzinich APAC Private Debt I fund is focused on private debt solutions targeted at lower middle-market companies with an EBITDA range of $5 million to $50 million and an operating history of three years or more, with audited financials.

The fund aims to generate recurring cash income with capital appreciation potential while minimising credit impairments, build a diversified portfolio across geographies and industries, as well as incorporate an ESG-conscious approach towards investments.

The investment will offer DBS several strategic benefits, including providing the group with growth exposure to recovery opportunities in the Asia Pacific, one of the fastest-growing regions globally. The region’s GDP is growing at 4.8% per annum, versus Europe at 1.5% and North America at 2.1%, according to IMF’s April 2020 World Economic Outlook Database.

The investment would also extend and diversify DBS’s credit participation beyond its traditional debt portfolio, aside from allowing it to have more active involvement in the fund activities to build up product know-how in the special situations space.

DBS CEO Piyush Gupta said while the special situations space is already well-established in the US and Europe, there is still room for further penetration in the Asia Pacific, especially as the region gradually recovers from the pandemic.

“This fund can play an integral role in bridging the financing gap faced by businesses that have been dislocated by the disruptions, complemented by our already established fixed-income franchise in deal sourcing and meeting more bespoke funding and investment needs across Asia,” he added.

Founded in 1988, Muzinich has offices in Hong Kong and Singapore, among others. The firm’s total assets under management currently stand at $39.3 billion.

It launched its private debt platform in 2014. As of June 2020, the private debt platform had $1.9 billion in committed capital and over $1.1 billion in invested capital.

 

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.