NEW YORK, Sept 23 (Reuters) - U.S. investment firm Valentus
Capital Management will raise part of a $250 million credit fund
through the public sale of its own unique virtual currency, the
company's top official told Reuters in an interview on Tuesday.
Valentus, which launched in March this year, aims to
register as a private equity firm with the U.S. Securities and
Its first fund - the Credit Opportunities Fund I - hopes to
raise $50 million through the digital token sale scheduled
sometime this year, said Behzad Taufiq, Valentus' chief
He added that this would be the first time a private equity
credit fund will raise capital using a digital token that will
be made accessible to U.S. retail and institutional investors.
Valentus aims to invest in assets such as mortgage
securities and distressed debt, a lucrative area that saw
private equity giants Apollo Global and KKR & Co raise $1.75
billion and $4 billion, respectively, the last few months, for
credit funds focused on COVID-related dislocations.
Financial services companies are increasingly resorting to
"tokenizing" their assets - a process of creating and issuing a
virtual currency on the blockchain that digitally represents a
real tradable asset. These tokens can be traded online in a
secondary market and provide companies with increased liquidity
and access to a broader base of investors.
Valentus is partnering with technology provider and fund
manager Realio for the digital asset's public offering.
The token, called VAL1, gives the holder a digitized claim
to the limited partnership interests of a Valentus fund.
"As I started thinking about raising capital and saw the
traditional route that everyone takes, with roadshows, travel,
and going after the same institutions, I was looking for an
alternative way to raise capital from the retail sector," said
"I think what we have understood recently, especially when
you see the fluctuations in the broader equity market, retail
investors, especially when they have access to assets, are a
strong force to reckon with."
The public sale will likely take place before the end of the
year, or possibly in early 2021, Derek Boirun, chief executive
officer and founder of Realio told Reuters, noting that appetite
for private equity tokens during the coronavirus pandemic is
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Alden
Bentley and Nick Zieminski)