Who is playing what Distressed Debt Deal?

In the distressed debt world, it is helpful to know who you are up against and who's side you are playing for in a particular deal. But how do you find this information out? Let's use Tribune as an example.

For reference, here is a link to Tribune's Claim Agent site: Tribune's Claims Agent

Tribune has been a favorite of the event driven / distressed hedge fund space for over 2 years now. Let's say you are interested in investing in the bank debt but want to get up to speed by talking to other investors you may know that already hold the position.

I goto the docket, and start poking through filings that could shed some light. You are looking for things like "Statement of Representation" which is just a fancy way to say XYZ legal firm is representing ABC Creditor. In Tribune, the first thing that pops up when searching starting with the most recent documents is Docket #3927.

It reads:

...3. HBD and YCST represent a number of individual creditors in connection with holdings of indebtedness governed by the Credit Agreement, dated as of May 17, 2007 (as amended, the “Credit Agreement”), by and among Tribune, each lender from time to time party thereto, and certain financial institutions as administrative agent, syndication agent, codocumentation agents, and joint lead arrangers and joint bookrunners.

4. The names and addresses of the creditors currently represented by HBD and YCST (collectively, the “Lenders”) are identified on Exhibit A, attached hereto. The aggregate principal amount of claims held by the Lenders against the Debtors currently totals approximately $3.8 billion.

In the above text, HBD and YCST stand for two legal firms: James O. Johnston, on behalf of Hennigan Bennett & Dorman LLP (“HBD”), and M. Blake Cleary, on behalf of Young, Conaway, Stargatt & Taylor, LLP (“YCST”).

And read that again - The creditors listed hold $3.8B of the claims. That is a big number. The file continues by listing the lender (with addresses). Here are some the names on the list.

Anchorage Advisors, L.L.C.
Avenue Investments, LP
Avenue Special Situations Fund IV, L.P.
Avenue - CDP Global Opportunities Fund, L.P. (US)
Avenue International Master, LP (Master)
Avenue Special Situations Fund V, L.P.
Canyon Capital Advisors, LLC
CFIP Master Fund, Ltd. c/o Chicago Fundamental Investment Partners, LLC
Contrarian Funds LLC
A Number of Franklin Templeton affiliated funds
GoldenTree Asset Management, LP
Goldman Sachs Loan Partners
Greywolf Capital Partners II LP
KKR Financial CLO 2005-1, Ltd.
KKR Financial CLO 2006-1, Ltd.
KKR Financial CLO 2007-1, Ltd.
Oregon Public Employees Retirement Fund
KKR Financial Holdings III, LLC
KKR Strategic Capital Holdings I, L.P.
Knighthead Master Fund, L.P.
Latigo Master Fund Ltd.
LP MA1, Ltd.
SEG Latigo Master Fund Ltd.
Luxor Capital Group, LP
Marathon Asset Management, LP
Newstart Factors, Inc.
Oaktree Capital Management, L.P.
Onex Credit Partners
Scoggin Capital Management LP II
Scoggin International Fund LTD.
Scoggin Worldwide Distressed Fund, LTD
Taconic Market Dislocation Fund II LP
Taconic Market Dislocation Master Fund II LP
Taconic Capital Partners 1.5 LP
Taconic Opportunity Fund LP
Värde Investment Partners, L.P.
Viking Global Equities LP
Viking Global Equities II LP
VGE III Portfolio Ltd.
Waterstone Market Neutral Master Fund, Ltd
Waterstone Market Neutral Mac51 Fund, Ltd
York Capital Management, L.P.

So just eyeballing it: Avenue, Canyon, Contrarian, Franklin Templeton, Goldentree, Knighthead, Luxor, Oaktree, Onex, Scoggin, Taconic, Viking, and York are in the mix. That is a strong list of solid hedge fund names.

Unfortunately, these filings don't tell you where these assets were being bought. But if you know someone at one of these places, you could make a call, get a summary of the situation, and you are off to races.


LawGuy,  4/09/2010  

Being on the legal side myself, I'd love to hear any feedback those of you who are investors have about your interactions with lawyers, specifically those who advise investors more often than debtors. Do you view them as strategic advisors or simply paperpushers/hencemen? Do you get the feeling they work more or less than you? What makes a good bankruptcy lawyer, from the investors' perspective? I'm trying to chart my course, and insights from the business side on these points would be very helpful.


hunter [at] distressed-debt-investing [dot] com

About Me

I have spent the majority of my career as a value investor. For the past 8 years, I have worked on the buy side as a distressed debt and high yield investor.