Brazil has an important space in the private equity market to be fulfilled by investors in countercyclical moments of the economy and/or in specific industries in crisis. IG4 Capital seeks superior returns primarily through creative capital restructuring including conversion of debt into equity and partnering with banks and existing shareholders.
While the Brazilian secondary credit market is still in its infancy stage, there are some interesting opportunities in high yield corporate debt, non-performing loans and over levered distressed assets, including real estate. IG4 Capital targets opportunities in which banks and other creditors seek an investor with a strategy to recover all or part of their debt.
In July of 2017, IG4 Capital closed its first transaction, the acquisition of Iguá Saneamento, formerly CAB Ambiental. The deal includes the creation of a R$410 million deal specific fund (FIP IGUA – IG4 Capital Special Situations I), in a partnership with leading Brazilian banks and capital from other financial investors.
IG4 Capital is currently fundraising for its second special situations fund (IG4 Capital Special Situations II), a US$400 million fund, targeting institutional offshore investors, pension funds, sovereign funds and developmental financial institutions.