International Finance Corporation (IFC), the private sector investment arm of the World Bank, has proposed to invest up to Rs 450 crore ($75 million) in Clearwater India Ltd (CIL), an India-focused non banking finance corporation (NBFC) which lends to financially stressed firms.
CIL is a portfolio company of Clearwater Capital Partners (Clearwater), which manages special situations focused PE funds.
IFC will invest in the form of a senior debt by subscribing to non-convertible debentures (NCDs) to be issued by the company.
CIL, an NBFC registered with RBI, was set up in 2005 as an onshore primary lending platform. Its investments are primarily focused in Mumbai, Delhi National Capital Region (NCR), Chennai, Bangalore and Pune.
The NBFC plans to scale up to lend to well-secured, operationally-viable but financially stressed Indian companies backed by hard assets and cash flows in the real estate as well as other sectors.
IFC’s proposed investment in CIL will provide capital support at a time when there is limited bank financing to support companies through stressed and distressed situations and lay the foundation for effective asset investment and a credit solution culture.
New York-based private equity firm Clearwater Capital Partners was formed in 2001 by Robert Petty and Amit Gupta. The firm has around 55 employees across five offices in Asia (Mumbai, Beijing, Seoul, Singapore, Hong Kong) and one in New York.
Recently Clearwater exited Mumbai-based marine operation and construction company Dolphin Offshore Enterprises India by selling its entire 6.53 per cent stake through open market transactions.
IFC, a fairly active investor through both equity and debt side transactions in India, had recently committed to provide Rs 201.9 crore ($34 million) to ACME Solar Energy Pvt Ltd, part of the ACME Group, for its Rajasthan project.
It has previously backed many NBFCs including Magma Fincorp, Avanse Financial, AU Financiers and Cholamandalam Investment & Finance.