What is going on with Catalyst Capital (Toronto, Distressed PE)?
Catalyst Capital was basically the only distressed fund in Canada that worked on legit deals (Cirque du Soleil bankruptcy), and was aggressive in fund raising but haven't raised a fund since 2015. An article from Buyouts Insider says faced a ton of litigation and pushed out their last fund by 1 year.
Apparently one of the founders is raising a new fund that is somewhat related to Catalyst but no info on that. Interested to see if anyone knows anything on this.
I wondered how long it would take for someone to post about this group. Firstly, you are correct in that they are the only Canadian distressed fund of any real scale. Culturally, there probably isn't a worse place to be - the CEO is a highly litigious lunatic who prides himself on extreme verbal abuse and humiliation. A friend of mine was an associate there and apparently the CEO would bring his dog into company meetings and ask his dog questions and respond that the dog was smarter than his employees.
The firm has a really bad name. They have threatened legal action against their own LPs and no one wants to buy positions in them via the secondary market - they're thought of as toxic.
In their most recent fund, which they raised at a terrible time for distress, they ended up having to refund investor capital as they couldn't find suitable investments within the investment period. They're known to have some weird tracking software in their quarterly reports so they can analyze if their LPs share their reports with other orgs.
Oh, and their one fund's NAV depreciated 75% within a single year. They invested in gateway newstands, and some casinos, and the returns were pure trash.
The dog thing sounds like a reverse Margin Call scene. Thanks for this though - have always been curious to learn more on the shop
Glassman is a legend but not in a good way. Exactly what you described.
Some of this is factually incorrect (the casino company is Gateway, they didn’t invest in newsstands lol) but the gist is true.
They had a couple good deals in Fund I and managed to raise 4 more funds off unrealized gains. I think their 2006 vintage fund is still largely unrealized, at least it was a few years ago.
They’ve had a number of big losses / borderline zeroes in recent years.
It would appear they are basically in wind down mode at this point, in between numerous lawsuit with LPs and former employees.
Converium capital was a relatively splashy Canadian distressed / event launch recently. Onex has some good distressed chops though the opportunistic credit team is mainly in New York.
Been a while since your comment but do you happen to have any insights on Converium?
Same here, would love to hear if you have any updated insights on the firm
While Glassman isn't that active anymore, his underlings are still considered toxic. No one wants to do a deal with them as you get the vibe that they will try and screw you over.
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