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EFA makes first close of planned US$300m APAC private credit fund

EFA Group, a Singapore-based alternative asset manager specialising in private debt strategies, has completed the first close of its latest Asia-Pacific direct-lending fund.

The firm announced on Monday that it had received commitments from existing and new institutional investors as well as its management team.

EFA did not disclose the amount raised so far. It is targeting a US$300 million final close by the end of 2020, raised through the group’s existing network of investors, capital allocators, and in partnership with a market specialist in Japan.

The new fund provides term loans secured against real assets to “established companies” in South-east Asia, Australia and New Zealand, EFA said.

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It will focus on the natural resources, manufacturing and logistics sectors, with environmental, social and governance, or ESG, considerations integrated into its investment process.

It will be a five-year closed-end fund, subject to two additional one-year extensions. EFA is targeting a net internal rate of return of 12 to 15 per cent by deploying capital in the same strategy as its first close-end credit fund which was launched in 2016.

The earlier fund deployed more than US$400 million across 22 transactions, delivering a net annualised yield of close to 12 per cent to investors, EFA said on Monday.

EFA has provided more than US$13 billion of financing to businesses in the past decade, with a captive network of over 300 borrowers. Headquartered in Singapore, it also has offices in London and Melbourne.