02 Dec Third Eye Asset Management Launches TEC Credit Income Fund with Initial Close of Approximately 225 Million
TORONTO, Dec. 2, 2021 /CNW/
Third Eye Asset Management Inc. (“TEAM”), an affiliate of Toronto-based alternative capital firm Third Eye Capital (“TEC”), is pleased to announce the initial closing of TEC Credit Income Fund (the “Income Fund) with approximately $201 Million of subscriptions of preferred units.1 TEC and its employees have invested a total of $29 Million, including $23 Million in common shares, which provides first loss protection for investors and the pre-funding of an income reserve. The Income Fund is targeting a total raise of $500 Million, which may be increased due to investor demand.
The Income Fund was formed to transition the Third Eye Capital Alternative Credit Trust (“ACT Fund”), managed by TEAM, into a longer, fixed-term investment vehicle that better aligns with the liquidity profile of the underlying loan investments and to meet demand from institutional and high net worth investors for a more predictable, stable-return exposure to TEC’s special situations credit strategy.
The Income Fund is an Ontario limited partnership that will operate as a “feeder fund” and will invest substantially all of its assets in TEC Credit Income Master Fund (the “Master Fund”), a Cayman Islands limited liability company. The Income Fund, the Master Fund and other entities that invest in the Master Fund or hold investments on their behalf (collectively the “TCI Funds”) are all managed by TEAM. In addition to being open to Canadian accredited investors, the TCI Funds have been structured to attract capital from investors globally.
Some of the significant benefits of the Income Fund include:
- an innovative, efficient investment structure that will provide investors with consistent returns and first loss protection on credit losses;
- the option to participate in gains from the equity kickers and other similar participation interests in portfolio companies granted to the TCI Funds in connection its loan portfolio;
- lower costs than ACT Fund with no management or performance fees charged to investors in the TCI Funds; and
- true alignment of the interests of TEAM with investors through its first loss protection and ongoing maintenance of cash reserves.
Arif N. Bhalwani, CEO of TEC, commented, “We are grateful for the confidence shown by existing ACT Fund investors and new clients in backing our mission to help unloved and overlooked Canadian companies that are undergoing change or complex situations access strategic capital to grow. The Income Fund allows investors to generate attractive fixed returns and the option for equity upside without the volatility and fee drag normally associated with private debt funds.”
Davies Ward Phillips & Vineberg LLP in Toronto and Maples Group in Cayman Islands acted for TEAM in the establishment of the TCI Funds.
About Third Eye Capital
Founded in 2005, Third Eye Capital (“TEC”) is Canada’s leading alternative capital provider to businesses in transition. Through its unique combination of tailored financing and value-added operational expertise, TEC empowers talented management teams to seize opportunities and realize growth potential more quickly and effectively. TEC has made approximately $4 Billion in investments across a diverse set of industries including technology, sustainability, traditional and alternative energy, mining, construction services, and transports.