Investcorp-backed Nut Tree’s assets under management top $2bn

Company completes final close of a $320m fund to invest in distressed corporate debt of mid-sized North American companies

Investcorp remains commited to reaching its $50bn of assets under management despite the challenges of Covid-19 and a global recession. Courtesy Investcorp

Investcorp-backed Nut Tree Capital Management has grown assets under management to $2 billion (Dh7.34bn) following the final closing of its drawdown fund with capital commitments of $320 million.

Nut Tree Capital's core strategy is investing in credit markets and looking to leverage periods of market dislocations to capture attractive opportunities in corporate credit. It has built assets of about $1.8bn through this strategy, after starting with $100m in 2016.

"Nut Tree’s holistic approach has helped generate strong risk-adjusted returns across cycles,” Lionel Erdely, co-head of Investcorp-Tages, said. “We look forward to building upon this success as we continue to identify attractive investment opportunities, partner with talented managers and serve our global clients with tailored solutions."

Based in New York, Nut Tree Capital Management is led by founding partner and chief investment officer Jed Nussbaum, who was previously a partner at Redwood Capital, a distressed credit manager.

The $320m Drawdown Fund has been created to invest primarily in distressed and deeply stressed corporate debt, with a focus on mid-size North American issuers.

Established in 1982, Investcorp is one of the oldest Middle East alternative asset managers, with $31.1bn of assets under management as of December 31, 2019, according to its half-year accounts.

Last month, it closed a new fund with €318m (Dh1.3bn) in commitments as it looks to pick up large-cap European secured loans amid the Covid-19 pandemic.

The Mount Row Credit Fund will target the largest and most liquid European issuers with average earnings before interest, taxes, depreciation and amortisation of more than €200m per annum.

The Bahrain-based company, which counts Mubadala Investment Company as its biggest shareholder, also closed a new fund targeting Italian distressed debt with €340m in commitments to invest in Italy’s non-performing loans market.

Investcorp earlier this year merged its absolute return investment arm with Italy's Tages Capital in a 50/50 joint venture to create Investcorp-Tages, a global multi-manager investment firm.

The company is looking at attractive investment opportunities to boost its portfolio amid the coronavirus pandemic. It acquired German cybersecurity company Avira for $180m as demand for technology-driven services grows.