Kempen to introduce Diversified Distressed Debt Pool
Kempen Capital Management (Kempen) has launched a new Diversified Distressed Debt Pool to its range of alternative investment products, giving professional and retail investors cost-efficient access to the Distressed Debt market.
Distressed Debt involves purchasing debt securities of companies that are in financial or operational distress, have defaulted, or are in bankruptcy. These debt securities are trading at a distressed level; well below par value. Distressed Debt funds can form a safety net for companies with too much debt by playing an active role in the restructuring of these companies and subsequently providing them with new capital.
The Diversified Distressed Debt Pool is built up of Distressed Debt funds that are carefully selected by Kempen, a firm that has invested in this strategy since as far back as 2005. The pool gives investors access to the Distressed Debt market through five dedicated and highly experienced investment specialists to provide good risk diversification. In addition, the pool has an open-end structure that allows investors to enter monthly and exit quarterly (quarterly redemptions up to 25 per cent of fund NAV).
Remko van der Erf, Co-head of Alternative Strategies at Kempen, says: ‘As Distressed Debt is a cyclical phenomenon, funds that specialise in Distressed Debt often perform very well after a crisis. These funds form a safety net for companies with too much debt. The best way to invest in Distressed Debt is through experienced specialists. We team these specialists up to form a pool to ensure that investing in Distressed Debt becomes accessible to a large group of investors. Our clients benefit from the fact that Kempen takes care of the selection, due diligence and monitoring, and also supervises the ESG policies of the funds. In addition, the pool offers access to best-in-class specialists as well as active portfolio management and comparatively good liquidity.’
Michiel Meeuwissen, Co-head of Alternative Strategies at Kempen, adds: ‘In the current market environment, in which investors are looking for new ways to generate returns, we want to offer our clients new investment propositions to help them achieve their objectives. Our strength lies in this specialisation and this is where Kempen sees it’s added value in meeting the needs of clients, now and in the future. We are therefore seeing great interest in the market for the Distressed Debt pool.’