Shoreline Capital, a Chinese distressed debt and special situations investment firm, has closed its second fund at US$303 million. The fund significantly surpassed the size of Shoreline’s first fund, which amassed $178.2 million of commitments in 2008. The firm has already invested over one third of the new fund’s committed capital.
Shoreline Capital, one of the most established private fund managers in Chinese distressed debt and special situation investments, has closed its second fund at US$303 million. The fund significantly surpassed the size of Shoreline’s first fund, which garnered $178.2 million of commitments in 2008. The firm has already invested over one third of the new fund’s committed capital.
The new fund, Shoreline China Value II, received commitments from a broad investor base across North America, Europe, Asia and the Middle East. Investors include endowments, foundations, pensions, funds-of-funds, family offices and high-net-worth individuals.
Since the firm’s inception in 2004, Shoreline has focused on credit-related opportunities arising from the inefficiencies in China’s financial system. Such opportunities include (i) debt restructurings; (ii) non-performing loan (“NPL”) portfolios; (iii) structured special situations financings; and (iv) distressed private equity and real estate. Shoreline is one of only a handful of established managers specializing in such a strategy and operating locally in China.
Mr. Benjamin Fanger, Co-founder & Managing Director of Shoreline Capital, elaborates on how China’s current market environment is conducive to Shoreline’s investment strategy: “China’s financial system allocates capital inefficiently, leaving many good companies without financing and bad companies with too much debt. The former produces special situations opportunities while the latter gives rise to distressed debt. Now that China is facing a slowing growth rate, these types of opportunities have multiplied. Since 2004 Shoreline has established a local team to source, structure and execute such transactions in China.”
So far, Shoreline has invested over one third of the new fund’s committed capital in five investments, including one NPL portfolio and various special situations. Such special situations are generally asset-backed rescue financings that allow companies to bridge periods where they cannot get bank loans. “The continuing inefficiencies in China’s financial system generate a healthy deal flow for Shoreline. We are excited about the opportunities,” Mr. Fanger said.
Commenting on private equity in China, Mr. Fanger added, “Investing in China is no longer about just getting on the bus. It takes more time, effort and local experience to ascertain the true status of a Chinese company and navigate China’s financial and legal environments. We believe the significant support from new and existing investors indicates their confidence that Shoreline possesses this experience.”
About Shoreline Capital Management, Ltd:
Shoreline Capital is a private fund manager founded in 2004 to specialize in finding and creating value in distressed debt and special situation investments in China. The firm has over 20 investment professionals in China and manages close to US$500 million of capital in portfolios of non-performing loans, restructured single credits, special situation financings, distressed private equity and real estate. Prior to 2008, Shoreline Capital sourced and serviced over US$1.6 billion (principal balance) of Chinese non-performing loans in one-off deals for third party investors. It closed its first discretionary fund at US$178.2 million in 2008 with an investor base of primarily endowments, funds-of-funds, pensions and foundations. Shoreline’s second fund closed at $303 million in February 2013 with a larger base of investors across North America, Europe, Asia and the Middle East.
This press release does not constitute the offer of advisory services or offer of a security or the solicitation of an investment.
Ms. Viviane Mao
Cell: +1 (408)221-6751