Flagstar Bancorp, which is majority owned by MatlinPatterson, is trying to raise $600 million in a share sale to boost capital after eight straight quarterly losses, according to Bloomberg News.

Flagstar has held talks with PE firm and may sell shares to current investors, the story said. Flagstar expects to use proceeds to boost capital and pursue growth, including possible acquisitions.

Last year, MatlinPatterson, which was founded by David Matlin and Mark Patterson, invested $350 million in Flagstar last year.

(Reuters) – Air transport services provider Global Aviation Holdings Inc Monday filed with U.S. regulators for an initial public offering of up to $100 million. The company said it would use proceeds from the offering mainly to repay debt. It did not say how many shares it plans to sell or provide an expected price [...]

NEW YORK (Reuters) – Private equity firm MatlinPatterson is trying to sell Polymer Group, a non-woven materials maker in which it is the largest shareholder, according to sources familiar with the matter. Blackstone (BX.N) is advising on the sale, the sources said, and the focus has been primarily on attracting private equity companies as bidders, [...]

Premium Protein Products, a Nebraska-backed packing company backed by MatlinPatterson Global Advisers, has filed for Chapter 11 bankruptcy protection. The firm invested in the company in 2007, according to the Lincoln Journal Star.

Absent a stalking horse bidder, control over a bankrupt company is given to its debtholders. That’s always seemed counter intuitive to me, since the debtholder population usually consists of varied species of hedge funds, lenders, and investors, none of which have a specific mandate or know-how to run a company.

It’s a curious situation which often results in a rapid sell-off. Sometimes buyout firms are hesitant to invest in a bankruptcy-bound company’s debt, or as a stalking horse bidder, but wait till this moment to bid. I spoke with Jennifer Feldsher, partner in the restructuring group at Bracewell Giuliani, about advantages of waiting versus diving in early.

When will the LBO-backed busts which have fallen into the arms of their lenders come to market?

In my experience so far, the traditional lenders aren’t interested in holding equity after restructuring and want a very quick exit. Those companies end up …

TORONTO (Reuters) – Sweden’s Ericsson has won an auction for the wireless assets of bankrupt Nortel Networks Corp, paying $1.13 billion for the crown jewels of the one-time Canadian telecom star. In separate statements, the two companies said on Saturday Ericsson had won the bidding for Nortel’s key CDMA and next-generation LTE wireless technologies, which [...]

TORONTO (Reuters) – MatlinPatterson, a U.S. private equity firm that’s a creditor of Nortel Networks (NRTLQ.PK), said on Tuesday it submitted a $725 million bid for the bankrupt Canadian company’s wireless technology assets. Last month, Nokia Siemens Networks — a joint venture of Nokia (NOK1V.HE) and Siemens (SIEGn.DE) — made a $650 million “stalking horse” [...]

TORONTO (Reuters) – MatlinPatterson is open to working with strategic partners in putting forward a comprehensive proposal to reorganize the businesses of bankrupt Canadian telecom equipment maker Nortel Networks, the U.S. private equity firm said on Wednesday. MatlinPatterson, a major bondholder and Nortel creditor, has stated that it does not believe that the proposed sale [...]

NEW YORK (Reuters) – MatlinPatterson Global Advisors, a private equity firm specialising in distressed investments, is considering leading a rescue bid for the whole of Nortel Networks, The Financial Times reported on Sunday. The New York-based company is trying to put together a consortium of investors to fund a recapitalisation of the Canadian company, the [...]

Distressed investment firm MatlinPatterson is striking back against UK newspaper The Telegraph, following an article in which firm chairman Mark Patterson is described as calling the U.S. Treasury’s public-private partnership program (PPIP), “a sham.” Kind of striking charge, given that MatlinPatterson invested alongside Treasury (via TARP) in troubled Michigan bank Flagstar Bancorp Inc. (NYSE: FBC).

In a letter earlier today to limited partners, Patterson wrote:

The article is an unfortunate and complete fabrication and a mischaracterization of our position on public-private investments generally and MP Thrift’s Flagstar investment in particular. We have demanded a retraction from The Telegraph, and the article has been removed from its website while an internal investigation is conducted. Nonetheless, we want to ensure that our Limited Partners hear our views on these matters directly.

Indeed, the only record of the story we can find at this point is in the blogosphere (excerpts here). The Telegraph even seems to have pulled the story from Factiva, in a sort of