BlackRock set to enter NPA investment space in India (2024)

Mumbai: BlackRock Inc., the world’s largest asset manager with $6.3 trillion in assets, is set to enter the distressed debt space in India, two people aware of the development said.

BlackRock is in the process of a hiring a managing director for its global private credit platform, who will focus on distressed and non-performing asset (NPA) opportunities in India, the persons cited above said on the condition of anonymity.

According to Reserve Bank of India (RBI) data, India had close to Rs8.41 trillion in NPAs as on 31 December.

According to the job description, which was reviewed by Mint, the position will be initially based in Singapore and after six months, permanently based in Mumbai.

The India managing director will be responsible for developing the strategy for distressed and NPA opportunities in India as well as for sourcing, assessing, executing and monitoring distressed and NPA investment opportunities in India for BlackRock’s Asian and global private credit platform.

Responding to a query from Mint, a BlackRock spokesperson said, “The search for local talent is to expand our Asian and global credit capabilities. There is no current plan to set up any funds. And we are not looking for any country head for the business".

BlackRock is already present in India as DSP BlackRock Mutual fund, a joint venture with DSP Group, in which it owns 40% stake.

Earlier this month, Bloomberg reported citing unidentified people that BlackRock was looking to raise as much as $2.5 billion for its latest private credit fund and had raised close to $1.5 billion so far.

The fund can either directly lend to businesses or invest in the credit of companies facing distress, the report said.

With this, BlackRock joins the ranks of other asset managers such as Blackstone, KKR, Apollo Global management and Baring Private Equity Asia, who have set up or announced private credit platforms in India.

Mint reported in April last year that Blackstone Group Lp had firmed up its plans to enter the private debt market in India and expects its first debt transaction in the country soon.

Amit Dixit, senior managing director and head of Indian private equity (PE) at the buyout firm has said that Blackstone which manages about $90 billion in credit globally, will make the investments from a fund managed by its specialized Tactical Opportunities Group and was identifying large deals in the Indian market. Blackstone has acquired a controlling stake in Mumbai-based distressed asset buyer International Asset Reconstruction Co. Pvt. Ltd (IARC) investing about $150 million.

KKR, which manages $168 billion in assets globally, has been one of the early movers to tap private credit opportunities in India, acquiring a licence to operate an asset reconstruction company India in December last year.

AION Capital, which is a joint venture between ICICI Bank and Apollo Global Management, also received Reserve Bank of India’s nod to start an ARC this March.

Among domestic private credit funds, the Edelweiss group has tied up with Canada’s Caisse de Dépôt et Placement du Québec (CDPQ) to invest in distressed credit while Piramal Enterprises has teamed up with Bain Capital Credit to acquire distressed assets.

According to the persons cited above, while BlackRock will evaluate classic credit deals such as debt securities, corporate mezzanine investments as well as asset-backed and specialty finance investments in India, it will also scout for opportunities in insolvency cases, where more than Rs2 trillion worth of non-performing assets are already up for resolution.

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Published: 23 Apr 2018, 02:07 AM IST