Bloomberg
is reporting
that the new vehicle -- the Distressed Senior Credit Opportunities Fund
-- will invest in "senior" and "super-senior" securities
backed by commercial and residential mortgages. Holders of the
mortgage-backed debt have been willing to part with it at fire sale
prices as they have had to continually write down the value of those
assets since the credit crunch began more than a year ago.
With banks and other financial firms eager to get this type of debt off
their books, buyers have been able to purchase at deeply discounted prices.
Earlier this month Apollo Global Management
received $2.3 billion
to buy distressed debt and plans to raise another $2 billion for a
European-focused distressed fund. Also Third Avenue Management LLC, run
by distressed debt specialist and activist investor Marty Whitman, is
out marketing a
$3 billion vehicle targeting those assets as well. -
George White
See Bloomberg story
See Dealscape post on Apollo fund
See Dealscape post on Third Avenue
