HK-based SC Lowy raises $450m to double down on APAC's special situations deals

Source: Eric Prouzet/Unsplash

Hong Kong-based SC Lowy has held the final closing of its latest direct lending fund at $350 million, alongside $100 million in a parallel co-investment managed account, to double down on Asia-Pacific’s special situations opportunities.

The global banking and asset management group, which specialises in high-yield, distressed and private structured credit, plans to deploy the new capital commitments to the Asia-Pacific region with a focus on private lending, debtor-in-possession (DIP) and rescue financing, trade claims, non-performing loans (NPLs) and bridge financing.

Hogan Lovells, the legal advisor to this fund raise, announced this in a statement on Friday.

SC Lowy will focus more on markets such as South Korea, Hong Kong, Australia, India and Indonesia, said the American-British law firm.

At a combined $450 million, the total commitments represent an over threefold increase from SC Lowy’s predecessor fund, which raised just over $100 million in 2018 with a focus on Asian direct lending.

Jamie Tadelis, SC Lowy’s head of business development, said in the statement: “We are extremely proud to have expanded our LP base to partner with world-class and astute investors across the globe.”

The fund-raise will enable SC Lowy continue its efforts in cashing in on Asia-Pacific’s under-exploited special situations market, which is widely acknowledged to offer better returns, less competition and stronger lender documentation than more developed markets such as Europe and the US.

The region’s current dominant players include Ares SSG, which is India and Southeast Asia-focused, and Hong Kong-based PAG, which closed $950 million for its third Asia loan fund in 2018. Bain Capital in June raised $2 billion for its second special situations fund, exceeding the $1.5-billion target and doubling the size of its first fund.

KKR & Co secured $1.1 billion for its first dedicated Asia credit fund in May while Goldman Sachs Group is raising its stake through hybrid investing in Asia from its $14-billion strategic solutions fund that specialises in credit and special situations globally.

Led by Deutsche Bank credit veterans Michel Lowy and So Cheon Lee, SC Lowy has invested and transacted in over $130 billion in loans and bonds since its inception in 2009. The firm has a team of professionals operating across Hong Kong, London, Milan, Mumbai, New York, Seoul, Shenzhen, Singapore and Sydney.

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