Toronto-based Third Eye Asset Management held the initial close of the TEC Credit Income Fund with roughly $225 million across various units and shares.
The fund is targeting a $500 million raise, but officials acknowledged that the figure may increase to do investor demand.
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 new offering was formed to transition the Third Eye Capital Alternative Credit Trust into a fixed-term investment vehicle that better aligns with the liquidity profile of the underlying loan investments. The fund is set 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 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,” said Arif Bhalwani, CEO of Third Eye Capital, which was established in 2005 as an alternative capital provider to businesses in transition.