Strategic Value Partners has closed its fifth special situations fund at a hard cap of $5 billion, beating its $4 billion target. SVSS V is focused on restructurings, event-driven investments, special situations and trading-oriented opportunities in North America and Europe. SVPGlobal’s previous special situations fund closed in April 2018 at a hard cap of $2.85 billion.
GREENWICH, Conn. and LONDON, Aug. 3, 2021 /PRNewswire/ — Strategic Value Partners, LLC and its affiliates (“SVPGlobal”), a global investment firm focused on distressed debt, event-driven investments, special situations and private equity opportunities, today announced the successful final closing of Strategic Value Special Situations Fund V (“SVSS V” or the “Fund”) at its hard cap of $5 billion. This fund closing, when combined with SVPGlobal’s existing portfolios and other fund raises, including last summer’s approximately $1.7 billion Dislocation Fund, has increased SVPGlobal’s total assets under management to more than $17.5 billion, making it one of the largest global investors in the distressed debt and special situations space.
SVSS V, which completed fundraising only three months following its first close, received significant demand beyond its hard cap and closed well above the Fund’s $4 billion target with support from a diverse and global base of existing and new investors. The Fund also exceeded the size of its predecessor, SVSS IV and associated vehicles, which closed in April 2018 at the hard cap of $2.85 billion.
Like its predecessor Special Situations Funds, SVSS V is focused on restructurings, event-driven investments, special situations and trading-oriented opportunities in North America and Europe. SVSS V already has made or announced investments in the basic industrial, aviation and real estate sectors.
Victor Khosla, Founder and Chief Investment Officer of SVPGlobal, said: “We are grateful for the trust and confidence investors from around the world have placed in our team and time-tested investment strategy. This successful and expeditious closing of our fifth special situations fund validates the consistency of our approach and our proven record of generating strong returns across market cycles. We are pleased to welcome new investors as we continue to expand our many long-standing relationships.”
SVPGlobal sources a majority of its investments directly, purchasing debt from banks and funds. The firm also takes an active role with most of its investments, regularly acquiring controlling equity interests through credit restructurings. SVPGlobal has an extensive track record of driving value creation in majority-controlled businesses through operational and strategic improvements. The firm is continually developing how it incorporates ESG considerations across its investment process, including by integrating standards across majority-owned portfolio companies.
“Over the past two decades, the SVPGlobal team has developed a differentiated ‘three pillar’ approach to distressed debt investing that combines aspects of traditional distressed credit and private equity investment strategies across traditional corporate restructurings as well as special situations opportunities,” Mr. Khosla continued. “To support this approach, we’ve undertaken a substantial talent expansion to approximately 130 employees worldwide, including growing our investment team to approximately 50, representing a 45% increase since April 2018. Our ability to deploy $7.5 billion since Q1 of 2020, and in fact increase our pace of investment in 2021 as the world thankfully recovers from the COVID-19 pandemic, is a testament to the strength of our team and our ability to identify opportunities others cannot access.”
Recent investments by the firm in debt-to-equity restructurings of companies in the U.S. and Europe include: Swissport International, the largest independent airport services provider and the second largest air cargo company in the world; OmniMax International, the leading U.S. manufacturer of residential roof drainage products; and Washington Prime Group, a retail REIT and recognized leader in the ownership, management, acquisition and development of retail properties.
Since 2008, SVPGlobal has raised four highly successful predecessor Special Situations Funds across multiple vintages: SVSS I (2008) with net IRR/net MOIC of 16.0%/2.1x; SVSS II (2010) with net IRR/net MOIC of 14.7%/2.1x; SVSS III (2013) with net IRR/net MOIC of 16.0%/2.2x; and SVSS IV (2017) with net IRR/net MOIC of 31.9%/1.6x (estimated performance as of June 30, 2021). This consistent, strong performance illustrates that all four Special Situations Funds are top quartile funds for their respective vintages for both IRR and multiple, according to the latest released Cambridge Associates LLC Distressed Securities Benchmark.
SVPGlobal is a global investment firm focused on distressed debt, special situations and private equity opportunities with more than $17.5 billion in assets under management. The firm, established by Victor Khosla in 2001, has approximately 130 employees, including approximately 50 investment professionals, across its main offices in Greenwich (CT), London and a presence in Tokyo. It was among the earliest U.S. distressed firms to establish a European office, opening in London in 2004. In total, SVPGlobal has invested more than $36 billion of capital since its inception in 2001, including $16 billion in Europe, and led over 150 significant transactions. SVPGlobal is a signatory of the United Nations supported Principles for Responsible Investment (PRI). The PRI is recognized as the leading global network for investors committed to integrating environmental, social and governance (ESG) considerations into their investment decision making.
Learn more at www.svpglobal.com.