Specialised Business Rescue fund for South Africa launches

Africa Special Opportunities Capital (“ASOC”) is pleased to announce the launch of ASOC Fund l, a special opportunities private equity fund focused on providing funding and turnaround services to companies in various states of distress, including business rescue. The Fund which was co-founded by restructuring and turnaround investment professionals, Richard Ferguson,
Shaun Collyer and Paul Birkett, intends to provide flexible funding in the form of post-commencement finance and other special situations financing, together with significant turnaround expertise.

ASOC Fund I is backed by anchor investors, Conduit Capital Limited (JSE: “CND”) and MMI Holdings Limited (JSE: “MMI”). The Fund currently has committed capital of R150 million (with R80 million of this immediately available to invest). ASOC will work alongside investee management to affect and fund appropriate business restructuring, thereby avoiding the possible winding up Of a business and the resultant loss Of employment and ongoing supply chain opportunities. The strong emphasis on job preservation and going concern businesses will help to contribute to sustaining the South African economy.

“Historically the missing piece for many business rescue processes has been a lack of funding” says CEO Richard Ferguson, “and we are excited to formally bring dedicated funding solutions to market in order to enhance the probability of success of business rescue and restructuring processes”.

Conduit Capital, a specialised investment holding company, is a shareholder and seed investor into ASOC. “We are backing a seasoned team to form ASOC” says Sean Riskowitz, CEO of Conduit Capital, “and in a difficult economy, we see ASOC as being able to invest in quality companies that need an opportunity to restructure their affairs in an orderly manner, but need
the funding and skills to do so. Shaun, Paul and Richard are ideally placed to capture this opportunity as there is no better team in the business”.

Kris Adams, Portfolio Manager at %mentum Altemative Investments says “Distressed investing has the potential to be negatively correlated to traditional asset classes. In addition to the excess alpha that one is able to earn from the strategy, there are a number of social benefits from saving a business from liquidation. The investment strategy compliments Momentum’s range of outcomes-based portfolios and we are excited to partner with this excellent team”.

Initially the fund will seek to invest across a range Of sectors in transactions Of between R30 million and R50 million. are seeking to raise R250 million for the pilot Fund l” says CIO Shaun Collyer “and that will permit us to do 4 to 6 transactions”.

Read the Full Press Release here and here