Distressed for Control / Loan-to-own
I know the strategy hasn't gotten a lot of love recently but curious if folks know of any reputable players still active and executing deals in the space.
Recently read Moyer and the complexity and potential upside is super interesting to me. Currently at a shop that strays away from control / loan-to-own type plays and thinking about maybe making a pivot to one that does. Also, if anyone has any resources they recommend on top of Moyer to learn more, it'd be great to learn about those as well.
Thanks all in advance!
Based on the most helpful WSO content, here are some insights into the distressed for control/loan-to-own strategy and reputable players in the space:
Reputable Players:
Current Market Dynamics:
Resources for Learning:
Additional Insights:
If you are considering a pivot to a shop that focuses on control/loan-to-own strategies, it would be beneficial to network with professionals in the field and stay updated on market trends through platforms like WSO.
I'm sorry, but it looks like this may be out of my ability to answer... maybe some of the links below might help?
Can’t say anything about the validity of the loan-to-own strategy today but here are decent books. Capital Accounts and Capital Returns (Marathon Asset Management’s books), Michael Gatto’s Credit Investor’s Handbook, and Ben Branch Bankruptcy Investing.
Different Marathon. you're thinking of the equities shop in london. great investors but the ppl there do not invest in distressed debt ftr
Restructuring Advisor here. Obviously, I’m not directly in the HF industry, but have plenty of experience on distressed deals. I can tell you that we’ve not seen many LtO funds come to play in recent years.
I’ve noticed that more and more deals wind up going the 363-sale route, which is partially why I suspect the loan-to-own strategy isn’t as common these days. Would love to hear someone’s perspective within the HF space, though.
second this. market structure has changed. far more out-of-court work as well. with increasing sophistication / supply of capital providers and other lme solutions, you really end up with a lemons problem (i.e., companies where you can run L2O playbook are typically trash). true L2O moreso happening in LMM context, or as small piece of much larger fund strategy (e.g., silver point), or dedicated drawdown/PE-style fund (e.g., SVP, KPS). not many true L2Os doing it anymore as a standalone strategy, and certainly not with open end funds. megafunds not really doing it either (headline risk = no bueno). everyone who has scaled up is trying to rebrand selves as friendlier solution provider b/c 10% irr on 20bb earns a lot more than 25% on 1bb funds. would lastly point out that this is a countercyclical strategy so it kinda makes sense that there isn't too much brewing right now...
Bump interested in l2o and activist, any primers or books would be cool
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