BNP Paribas Capital Partners (BNPP CP), BNP Paribas Asset Management’s specialist in external alternative manager selection, has launched an investment programme to provide institutional investors with exposure to the European discounted private debt market.
Fundraising is ongoing, with the final target of EUR250 million expected to be reached in 2019.
The investment programme is structured as a closed-ended fund of debt funds, with a lifespan of seven years and an average duration of about two and a half years. It aims to offer investors a net internal rate of return (IRR) of around 9-12 per cent.
Capital will be deployed in funds invested in corporate debt issued by mid-sized companies that have experienced difficulties or have been excluded from traditional financing channels. The managers selected by BNPP CP target corporate debt and loans, either performing or non-performing, and primarily tier one, within the European financing system. Debt may be bought either on the secondary market or from banks holding it since issue.
The new fund will meet the Solvency Capital Requirement under Solvency II, with a breakdown of each underlying fund’s portfolio available in AMPERE matrix format.
Gilles Guerin, CEO of BNP Paribas Capital Partners, says: “The initial closing of BNP Paribas CP European Special Opportunities Debt Fund demonstrates the value and relevance of the concept and will allow us to begin implementing the investment programme. The strategy is being managed by our specialist investment team, whose members average almost 16 years’ experience of identifying, selecting and investing in alternative funds.”
Thierry De Rycke and Giuliano Rajabally (pictured), co-managers of BNP Paribas CP European Special Opportunities Debt Fund, add: “We are very pleased with the positive response from investors, confirming the robustness of our approach in carefully selecting highly specialised managers with proven expertise in their respective markets in Europe. BNP Paribas CP European Special Opportunities Debt Fund offers investors access to market opportunities that are difficult to capture directly.”