When a portfolio company underperforms, an equity sponsor will want to assess the degree of negotiating leverage the company’s lenders have against the company under the circumstances, which can play a significant role in defining the terms of waivers or amendments or of an eventual workout to be sought with the lenders. Strategic options available to a sponsor will depend, among other things, on the degree of leverage, or perceived leverage, held by lenders. Two recent court decisions may impact this balance and the relative strength of lenders versus their distressed borrowers.
<p>In a casino, doubling down can be dangerous. But in private equity, it’s increasingly becoming the best way to eke out a profit on a bet turned bad.</p> <p>From Apollo Global Management LP to Bain Capital to Thomas H. Lee Partners, investors have bought hundreds of millions of dollars of debt in struggling businesses they took private, giving them positions as both stockholders and creditors.</p>
<p>Global alternative investment manager Värde Partners has raised $1.74 in committed capital for its twelfth buyout fund. The new fund, named Värde Fund XII closed with $1.74 billion of committed capital, the company said in a statement. As with Värde’s previous funds, the new vehicle will invest in opportunities across a broad array of geographies, segments and asset types with a focus on value-based and credit-oriented investments in investment themes related to bank retrenchment, new distressed cycles and market distress still remaining from the great financial crisis.</p>
Hedge funds were up 1.35 per cent in January, according to the Barclay Hedge Fund Index compiled by BarclayHedge, with all but two of Barclay’s 17 hedge fund indices gaining ground during the month. Emerging Markets got off to a fast start in 2017 with a 2.63 per cent gain, Technology was up 2.57 per cent, Healthcare and Biotechnology gained 2.22 per cent, the Event Driven Index added 2.08 per cent, and Distressed Securities were up 1.78 per cent.
The owner of nine Greenpoint rental buildings narrowly escaped foreclosure Wednesday after closing on the $27 million sale of eight of the properties to Black Spruce Management, sources told The Real Deal. The distressed properties were notably at the center of a $150 million lawsuit from 2015 in which the owner, Sylvester Smolarczykâs SMK Property Management, accused Madison Realty Capital of predatory lending practices. A Kings County Supreme Court judge dismissed the suit in September. ... [more]
Former Visium Asset Management portfolio manager Stefan Lumiere improperly sought to boost the value of the hedge fund's distressed debt holdings, defrauding investors while enabling the investment firm to earn millions in fees, U.S. prosecutors alleged in court Wednesday - a charge the defense denied.read more
Hedge funds gained 1.01% during the month of December, with 2016 returns coming in at 4.48%. Meanwhile, underlying markets as represented by the MSCI AC World Index (Local) gained 2.38% in December with its 2016 returns coming in at 7.37%. North American equity markets traded higher in December as the Trump-driven reflation theme buoyed markets in a somewhat ‘honeymoon’ period post-election. The S&P 500 Index gained 1.82% during the month, with the DJIA also up 3.34%. Indeed, central bank actions in the developed world outside of the US have helped to mediate year-end jitters to some extent. The ECB and...
Two former Ares Management LP private equity executives have joined forces to form a new firm called LightBay Capital focused on middle-market buyouts and distressed debt investments, according to people familiar with the matter.
In an another tough year for hedge funds — where the industry was forced again to defend its high fees and generally underwhelming returns — Jason Mudrick’s $1.4 billion Distressed Opportunity fund is putting the finishing touches on a dramatic turnaround. After finishing 2015 down 25 percent, Mudrick’s distressed debt fund is up nearly 40...
Investel Capital Corp has acquired all of the shares of RuralCom Corp, a Vancouver wireless operator offering services in under-served areas in Canada, from RuralCom Capital Corp. No financial terms were disclosed. Vancouver-based TNW Networks Corp, a telecommunication services provider and Investel affiliate, said RuralCom will now operate under its wireless brand. Investel, which has offices in Vancouver and Toronto, specializes in acquiring telecom companies, including distressed and underachieving companies, and developing new technologies.