Brescon in talks with investors for raising $250-300 mn for its AIF

Debt restructuring and turnaround specialist firm Brescon & Allied Partners LLP (Brescon) has initiated early talks with domestic and global investors to raise around $250-300 million (around Rs 1,875-2,250 crore) as part of an Alternative Investment Fund (AIF).

“We aim to do deals worth Rs 2,500 - 3,000 crore, targeting around 4-6 transactions in the current calendar year," stated Nirmal Gangwal, managing partner of Brescon.

The firm is also in discussions to close a deal for investing $150 million which could be through the AIF, or the recent strategic partnership with Singapore-based Broad Peak Advisors (Broad Peak), which closed in November.

“The fund, largely a category II AIF that will explore deals of around Rs 500 crore (approximately $67 million) each, could be a mix of providing financing to either special situations in distressed or growth companies, structured credit, recapitalisation funding or a mix of all of it,” stated Vishal Prakash, partner and head of Structured Credit & Recapitalisation Funding at Brescon.

“We plan to raise our own AIF with at least $250-300 million fund size and it could be larger. We are working on the strategy, objective and mandate of the fund. We are in early discussions with LPs (limited partners), domestic and part global and other wealth managers,” Vishal Prakash added.

Prakash, who joined Brescon in May 2021 and is tasked with enhancing its product portfolio, further stated that besides the appetite of the LPs, Brescon will associate with some domestic partners to come in and “invest on a club basis on a day-to-day basis” like a co-investor.

Breson is also evaluating the option of getting capital from Gangwal’s family office. The commitment could be around 5-10 per cent of equity or around $10-13 million (Rs 75-100 crore).

The fund will also be evaluated by Brescon taking into account the new framework on Special Situation Funds announced recently by market regulator SEBI. Gangwal firmly believes that local capital markets could become more mature and increasingly larger over the next five years. He has emphasised that the focus of the Insolvency Resolution Process should be to attract domestic capital to create a new class of investors.  

Over the past few years, two large transactions worth $500 million (around Rs 3,500 crore) involving Jayaswal neco Industries and Panacea Biotec have been executed by the turnaround advisory firm. In 2016, Brescon had tied up with billionaire Ajay Piramal-led Piramal Enterprises Ltd to float an Rs 6,000 crore fund.