INSUBCONTINENT EXCLUSIVE:
By Denise WeeOaktree Capital Group LLC, one of the world’s largest distressed debt investors, is eyeing India as a key market as the
nation overhauls its bankruptcy rules and banks battle with a historic bad debt clean-up.
“I wouldn’t be surprised to see India as
another engine of growth maybe in the next three to five years,” said Jay Wintrob, chief executive officer at the Los Angeles-based firm,
in an interview in Hong Kong
“We are spending a lot of time in India, getting up to speed.”
India’s $210 billion pile of stressed assets and distressed borrowers
have attracted global funds from Varde Partners to JC Flowers Co
The nation’s so-called dirty dozen -- 12 large debtors that have been ordered to go through the bankruptcy courts -- are testing the
country’s insolvency rules
A high-profile default by Reliance Communications Ltd
is also proving a litmus test for how foreign creditors get treated.
Oaktree, which has about $100 billion of assets under management,
doesn’t have an onshore presence in India, and currently invests a “very, very small amount” in the nation, according to
Wintrob.
Local Partners“We have yet to open our first Oaktree office in India
That’s something we have considered,” said Wintrob
“I think we are looking to form one or more local partnerships.”
The distressed debt investor has seven offices in Asia, including ones
in Hong Kong, Singapore, Shanghai and Beijing
Wintrob said that “under the right circumstances,” his firm may open a physical office in India at some point.
Oaktree is following the
limited number of insolvency proceedings in India and feels optimistic about how those proceedings are going, said Wintrob
Potential ways to expand in the nation could include setting up or investing in non-banking financial companies and India’s bad loan
buyers, or so-called asset-reconstruction companies, he added.
The firm is looking to lend directly to companies in India and also invest in
bad loan portfolios, and is looking at sectors including energy and infrastructure, according to Wintrob
He declined to say whether Oaktree is looking at the dirty dozen.
