PE to SS HF - preparation

Hey, trying to lateral from a PE seat (MF Infra) to special sits at a smaller, more liquid / nimble shop. Rationale is I would like to invest across the capital stack and across industries, as well as touching public / private. In preliminary talks with some names but want to put together some independent pitches etc. Question is - how do you source SS / distressed ideas? Petition, Debtwire etc.? Any tips very welcome!

2 Comments
 

Based on the most helpful WSO content, here are some tips for sourcing special situations (SS) and distressed ideas:

  1. Key Resources:

    • Debtwire: A go-to for distressed and restructuring news, providing insights into potential opportunities.
    • Petition11: A free newsletter that covers recent bankruptcies and distressed situations, though not highly technical.
    • Reorg Research: Offers write-ups, basic models, and covenant/event-driven articles. Many schools or firms provide access.
    • WSJ Pro Bankruptcy: While expensive, even a regular WSJ subscription can provide valuable headlines and material.
    • Bloomberg: Known for its comprehensive coverage of distressed/bankruptcy news.
    • Claims Agents: Platforms like PrimeClerk, KCC, and EPIQ can help you track bankruptcy filings and claims.
  2. Bond Screeners:

    • Use tools like FINRA or brokerage platforms to screen for bonds with high yields or distressed pricing. This can help identify potential opportunities.
  3. Networking:

    • Engage with professionals in the distressed and special situations space. They can provide insights into current trends and opportunities.
  4. Independent Pitches:

    • Focus on identifying companies with stressed balance sheets, upcoming debt maturities, or industries facing macroeconomic headwinds.
    • Analyze the capital structure and potential recovery scenarios. Highlight how you would approach the investment across the capital stack.
  5. Broaden Your Research:

    • Look into non-performing loan (NPL) portfolios, lease financing, or patent monetization as potential special situations opportunities.

By leveraging these resources and strategies, you can build a strong foundation for your independent pitches and demonstrate your ability to source and analyze SS/distressed ideas effectively. Good luck with your transition!

Sources: Distressed debt / special sits investing - On the job, Special Situations / Distressed Recruiting, Distressed vs. Credit vs. Special Situation vs. Turnaround PE, DIP Financing as a Strategy to Ownership, What are your favorite restructuring resources?

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 
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