Northern Arc Diversified Debt Fund raises Rs 400 Crore+; Northern Arc India Impact Fund matured with 14.59% Gross XIRR
* Northern Arc Diversified Debt Fund targets Rs1,500 Crore corpus, with an additional Rs 500 Crore greenshoe option; aims to deliver 16% XIRR through investments in performing credit opportunities and holds a AA(SO) rating from CareEdge ratings.
* The Northern Arc India Impact Fund (India Impact Fund), delivered a return of 14.59% Gross XIRR, in line with targeted returns, marking a significant milestone in Northern Arc Investment Managers Private Limited’s private credit journey since FY2014–15
Northern Arc Investment Managers Private Limited (“Northern Arc Investment Manager”), the asset management subsidiary of Northern Arc Capital Limited, a diversified financial services platform has announced the first close of its Northern Arc Diversified Debt Fund, with commitments exceeding rs 400 crore from institutions, family offices, ultra-high-net-worth individuals (UHNIs) and high-net-worth individuals (HNIs). This fund is Northern Arc Investment Manager’s 15th private credit fund, a sector-agnostic Category II Alternative Investment Fund (AIF) focused on performing private credit opportunities. Rated AA (SO) by CareEdge Ratings, the fund targets a corpus of Rs 1,500 crore, with an additional greenshoe option of Rs 500 crore, taking its potential size to Rs 2,000 crore, with a tenure of five years, the fund targets 16% XIRR.
The announcement coincides with the maturity of Northern Arc India Impact Fund, which channelled global capital into financial inclusion opportunities across India. Over its tenure, the fund supported 60 businesses across credit cycles, with gross deployment of over Rs. 1398 crore at fund Level, backed by investments from ultra-high-net-worth individuals (UHNIs), family offices, and domestic and global institutional investors.
Commenting on the announcements, Ashish Mehrotra, Managing Director and Chief Executive Officer, Northern Arc Capital, said, “The first close of the Northern Arc Diversified Debt Fund reflects continued investor interest in private credit and its evolving role in sophisticated investment portfolios. The maturity of our Northern Arc India Impact Fund further demonstrates our experience in managing private credit investments across credit cycles. Together, these milestones reinforce our focus on disciplined credit selection, portfolio diversification and risk management. Over the past decade, we have built a diversified private credit platform that has deployed over Rs 16,500 crores across 15 AIFs and two PMS offerings and served more than 1,500 investors across institutional and wealth segments. As private credit becomes an increasingly strategic allocation for investors, we remain focused on connecting capital with businesses across sectors while creating opportunities for risk-adjusted returns.”
Since its inception in 2014, Northern Arc Investment Manager has launched 15 funds, of which seven have fully matured delivering returns to the investors at a weighted average XIRR of over 14.5%, in line with targeted returns, without any extension or principal loss to the investors. Northern Arc Investment Manager has cumulatively distributed over Rs 10,000 crore of principal and coupon since inception and manages private credit funds and investment mandates.
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