Thoughts on Harvey Capital Partners and Lane42?
2 of the highest profile special sits launches of the past year. Want to share some thoughts and see what everyone thinks about them and the broad special sits landscape.
Founded by ex King Street CIO, Harvey seems to be more public focused and functions similarly to traditional distressed credit HFs. Lane42 is founded by Scott Graves, who was co-head of Ares SOF and worked at Oaktree before. On first look, Lane42 should be more like ASOF with a bend for private deals. But the $2bn initial funding from Millennium makes me think otherwise.
How do folks feel about these new launches? There seems to be more discussion about distressed credit and special sits funds on WSO. Is the Golden Age of distressed finally coming?
Taking a step back, more and more special sits funds are now investing across cap stack, in public and private situations. Is that a sign of the industry evolving or the continuation of the decline of distressed credit as a pure asset class?
Sorry for the rambling. But curious to hear your thoughts.
Lane42 team is absolutely stacked
Saw a lot of rx then distressed credit folks. Are they mainly in NY? Thought HQ in La
Crossed paths with few of those guys in a prior life… Joe is a total tank. assume they have a lockup on the Millennium $…
tank? wdym
At the senior level sure, but the junior level backgrounds are pretty weak imo
weak? they have pretty good backgrounds from well known banks + funds... do you want warren buffett to be your junior to have a strong team?
Bump
Graves has good track record at both Oaktree and Ares and is a very strong capital raiser. More rescue financings and prefs on the private side than liquid on the run credit. Goldschmidt made his name on Lehman at King St, much like the firm a very mixed run for him since the GFC.
what a waste if Lane42 assembled the avengers to just do private credit. need to see them in some steercos
deleted
lol no
I think it’s definitely public and privates. There’s not that many situation where a company is large enough and want a $50mm+ pref / structured credit solution
del
How did Harvey raise 1bn?
I think they have $500 in the door expecting to get to $1bn so call it $500m today. And they have a pretty credentialed founding team. On top of Paul, Bob Ryan ran the Lehman position for Elliott as well and retired off that before coming out of retirement to go to Silverpoint. Paul's stint as PM at King Street generally went okay it sounds with decent years ex-2022.
Separately the KS returns from mid-2010s if you look at return on actual invested capital were actually pretty good given they ran at ~40-50% cash waiting for the distressed cycle that took a long time to come. So to print a MSD return sitting on that much cash, your return on actual invested capital has to be pretty good given management fee / carry on whole pool issues. Think they could explain around the invested / cash issue given they aren't gong to be a $20bn fund, will be a LSD billion fund for now and Goldschmid wasn't a PM then.
All said we will see how this fairs in next couple years but its not insane to me that they raised and raised what they did.
del
This aged well
Its been awhile since this has been updated - has anyone seen either of these funds on notable LMEs? Or in interesting credit trades?
Also any insight on what RX groups they look at for associate/analyst positions?
bump - curious abt reecuiting from incoming rx seat
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