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Global credit funds & CLO's
November 2023 | Issue 259
Published in London & New York.
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Opinion
November 2023 | Issue 259
Past returns
Remember Zohar?
10 years ago in Creditflux, we reported that three Zohar deals, managed by Patriarch Partners, had opaque portfolios of mainly shadow rated assets, financed by negative basis trades. Then in November 2013 rumours began to swirl that the original investors had started offloading their positions in the secondary market.
The next five years saw a hugely protracted legal battle between Patriarch founder Lynn Tilton, investors and
the SEC.
The whole sorry affair finally ended five years ago with the declared bankruptcy of all three Zohar CLOs, which was a rare black mark against the asset class.
Points up front
A rose by any other name
Arguments are still raging about whether private credit is eating the public debt market’s lunch. But at ABS East Amir Vardi raised the intriguing possibility that we’re all looking at this from the wrong perspective. According to Vardi, a recent private credit transaction had a full 48 different lenders participating.
That sounds less like a “club” of lenders to us, and more like a broadly syndicated distributed model. Just one in which the banks have been cut out of the loop.
If investors push for a little more transparency in the space “to improve liquidity” then maybe we can come full circle, and everyone will get to eat their lunch. Except for the bankers.
It’s all coming up roses in private credit’s garden
Overwhelming enthusiasm
The results of our annual CLO Census are released in this issue, and we’re delighted that more than 500 market participants joined the voting this year. As well as the questions about market sentiment, the census features a variety of questions about the market’s favourite banks, law firms and service providers.
Over the years many readers have become passionate about those results. But don’t worry if your enthusiasm led you to misread the instructions asking you not to vote for your own company — we carefully discarded all those mistakes.
THEY SAID IT
“I hope you all have a good flight back, as that may be your only soft landing”
CSAM’s Amir Vardi reflects on the deteriorating macroeconomic conditions at ABS East.