Oaktree Capital Group LLC, 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.