Canada’s largest pension fund CPPIB will call off its proposed joint venture with Kotak Mahindra Group to invest in stressed assets in India. The $525-million fund that was announced in March 2016 will be wound up as it failed to find investments in stressed assets, said two people with direct knowledge of the development.
Kotak Group will now go alone with commitments from some sovereign funds such as Abu Dhabi Investment Authority (ADIA) and Qatar Investment Authority on a deal to deal basis. Both ADIA and Qatar Investment Authority are investors in some of the funds of Kotak.

“Our venture with CPPIB will end by August,” a person with direct knowledge of the development said. “We will now invest from our proprietary book while also looking to join hands with our investors like ADIA and Qatar Investment Authority to buy stressed assets from NCLT.”

Last year, in a joint press release, CPPIB had said it had the ability to invest up to $450 million in the fund that was to have initial corpus of $525 million. “This investment will address the growing opportunity arising from the current stress in Indian banking and corporate sectors, and has a flexible investment mandate providing bespoke financing solutions, in addition to investing in stressed asset sales by banks with the aim to restructure, recover and turnaround companies in distress,” the company had said at that point of time.

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