Marks’s Oaktree Seeking $500 Million for Senior Loan Fund

Oaktree Capital Group LLC (OAK), the world’s largest distressed-debt investor, is seeking $500 million for a fund that will invest in U.S. senior loans, according to a fund document.

Oaktree Enhanced Income Fund II LP expects to use leverage of as much as three times, according to an excerpt from a private placement memorandum viewed by Bloomberg News. Alyssa Linn, a spokeswoman at Sard Verbinnen & Co., declined to comment on behalf of Oaktree.

Oaktree is pitching the fund as investors hunt for yield amid record-low interest rates. Oaktree’s predecessor fund, which is targeting returns of close to 10 percent after fees, gathered $1.8 billion, surpassing its $1.5 billion target, John Frank, Oaktree’s managing principal, said on an earnings call last year.

Howard Marks founded Los Angeles-based Oaktree in 1995 with Bruce Karsh and five other partners from TCW Group Inc. The firm manages various strategies including distressed trading and debt-for-control, emerging markets, mezzanine and real estate.

To contact the reporter on this story: Sabrina Willmer in New York at swillmer2@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net

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