Caisse de Dépôt et Placement du Québec (CDPQ), the second-largest pension fund in Canada, has inked a long-term partnership with Edelweiss Financial Service Ltd to invest approximately Rs.5,000 crore (nearly $750 million) in stressed assets and specialized corporate credit in India, over the next four years.
As per the agreement, the Canadian pension fund will make annual investments of Rs.1,250 crore in stressed assets and specialized corporate credit, totaling to around Rs.5,000 crore over the next four-year period. This will make it the single-largest investment by an institutional investor in this sector. CDPQ has also agreed to acquire a 20% equity stake in Edelweiss Asset Reconstruction Co. (EARC). This will allow EARC to access CPDQ’s funding and invest in new stressed asset companies it acquires from banks and also provide necessary capital in assets that will be available on EARC’s book.