CarVal Investors LLC, the asset- manager unit of Cargill Inc., raised $1.1 billion for a distressed debt credit fund as it seeks to invest in assets off- loaded by European banks shrinking their balance sheets.
The CVI Credit Value Fund II, which CarVal expects to close later this year, will invest in a range of debt, including corporate bonds, mortgage-backed securities and loan portfolios, the Minneapolis-based company said in an e-mailed statement.
“The fund will invest globally in distressed credit opportunities coming from the deleveraging of financial institutions in Europe and beyond,” according to the statement.
European banks will sell off about 60 billion euros ($80 billion) of loans this year, compared with 45 billion euros sold in 2012 and 36 billion euros in 2011, according to estimates by PricewaterhouseCoopers LLP on Jan. 4.
CVI Credit Value Fund I, a CarVal-managed credit fund that already invests in distressed debt, recorded a 28.4 percent return in the first 10 months of 2012, CarVal said Nov. 28.
CarVal, founded by Cargill in 1987 to focus on proprietary and high-yield debt trading, agreed to buy 380 million euros of non-performing real estate loans from Lloyds Banking Group Plc in November, paying about 25 percent of the face value, people with knowledge of the transaction said at the time.
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