Distressed loans / debt primer?
Any primers on distressed loan and debt investing? I’ve already read Moyer and the HL primer doc.
Any others much appreciated.
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https://www.wlrk.com/webdocs/wlrknew/ClientMemos/WLRK/WLRK.28050.22.pdf
moyer is great, but it's outdated.
if you want to understand the actual mechanics of loans, you need to understand the contract.
the technicals: read "the lsta's complete credit agreement guide". distressed loan investing is an arbitrage of contractual loopholes. if you can't spot a trap door in a "restricted payment" covenant, you can't invest.
the reality: stop reading textbooks. go to a restructuring administration site (like kroll or stretto). pull the "first day declaration" (usually the declaration of the CFO/CRO) of a recent bankruptcy.
it is a 50-page summary where the cfo explains exactly why the company died, how the capital structure failed, and who gets paid what.
that is real time education
Sharing a broader library from the legal side. Given the interest surrounding covenants for LMEs, will also add some high-yield and credit guides. All are publicly available, except the LSTA and the STB's Credit Commentary.
Restructuring:
Structuring Liability Management Transactions (Mayer Brown): https://www.freewritings.law/wp-content/uploads/sites/24/2022/06/IFLR_L…
If you're short on time, there's a presentation on the same content: https://www.mayerbrown.com/-/media/files/perspectives-events/events/202…
High-Yield:
Credit:
If there is enough interest will also add some academic papers on bankruptcy law.
Post the academic papers pls. I’m getting a hard on over here.
I gotta say… I’m as flaccid as a worm in a jar of melatonin… but I’m still holding out hope for those papers! 🤞
Thank you for posting all of this info though. True gold mine.
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