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UK/US - Marathon holds $400m first close on US toxic asset fund

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London-based Marathon Asset Management has held a $400m first close of its public-private toxic asset fund, an initiative engineered by the US government to buy up troubled assets from banks that has so far seen $5bn raised by eight seperate fund managers.

The Public Private Investment Partnership was announced in March 2009 by the Treasury Department and the Federal Reserve.

In July this year, nine firms were selected to raise $500m each from private investors, which would then be matched by the Treasury Department and doubled with debt financing. The chosen firms, which include TCW Group and Oaktree, had 12 weeks to raise the capital.

Despite the fact that Marathon fell short of its target by $100m, reports suggest that government support for the firm has been confirmed regardless.

Eight of nine managers have raised $5.07bn in total, as Oaktree is the only firm to have not yet held a first close. The total purchasing pool will total around $20.26bn after government capital and debt from the Treasury.

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