Prisma Capital Ltda., the alternative-asset manager created by former Banco BTG Pactual SA partners, is hunting for “complex situations” in Brazil to invest about $650 million raised for its third fund. “We have a flexible mandate that allows us to invest in a range of asset classes and securities, including private or public equities, credit, real estate, companies under bankruptcy protection and and claims,” Marcelo Hallack, a Prisma co-managing partner, said in an interview. “The dysfunctions present in Brazil’s political, legal and tax systems, which chronically result in macroeconomic volatility, also create investment opportunities”, he said.
Brazilian corporations are struggling to access capital amid a steep increase in the nation’s benchmark interest rate, which has soared to 10.75% from 2% a year ago. A virtual halt in economic activity and shrinking capital markets are adding to the pressure, as are Russia’s invasion of Ukraine and Brazil’s looming presidential election in October. Brazil’s economy is expected to grow just 0.5% his year, down from 4.6% in 2021, according to forecasts compiled by Bloomberg. During these kinds of economic cycles, banks typically become more cautious in providing credit, and that increases the demand for the kinds of capital solutions that Prisma can provide, said Lucas Canhoto, a co-managing partner of Sao Paulo-based Prisma.
Prisma has competition in its search for opportunities. Jive Investments, Brazil’s largest distressed-asset manager, plans to raise as much as 7 billion reais ($1.4 billion) for a new fund this year, Guilherme Ferreira, a Jive partner, said in an interview last year. And Mubadala Capital, Abu Dhabi’s sovereign wealth fund, said in February that it’s received commitments of $322 million for its Brazil Special Opportunities Fund I, its first in Brazil, according to a statement. Prisma can invest in any industry, and so far has chosen sectors including infrastructure, energy, real estate, telecommunications, oil, gas and technology. The firm’s funds also invest in legal claims and litigation finance.Prisma was founded in 2017 and has $2.3 billion in assets under management. About 70% comes from institutional offshore investors, including endowments, foundations and sovereign-wealth funds, and 30% is from Brazilian family offices.
Original Story: BloombergQuint| Cristiane Lucchesi
Photo: Prisma Capital Linked IN
Edition: Prime Yield