ICG launches second recovery fund

The fund is believed to have a target of around €1bn and has already started to pitch investors, including Teachers' Retirement System of Louisiana, which is considering a $50m commitment.

This second vehicle will be larger than its predecessor, which was launched in 2008 "to exploit opportunities in the loan market arising from the global financial crisis (GFC)", according to ICG.

The fund held a first close on €475m in 2008 and a final close on €843m in March 2010, exceeding its €750m target. The fund is currently fully deployed and has reaped an IRR of around 11%.

Like its predecessor during the 2008-2009 GFC, this new recovery fund will target companies with solid businesses, which are experiencing dull performances and balance sheet problems or where the debt is constraining the company's growth. The fund might also explore distressed and special situation strategies.

The fund is expected to provide financing primarily to support private-equity-backed companies outside of ICG's existing portfolio that may benefit from de-leveraging and an increase in funds available for growth.

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