It’s the numbers edition: One bankruptcy, $3 billion in assets for sale, $900 million in fresh capital, two troubled mattress companies, many a unitranche loan, and one train stopped dead in its tracks.
Oops: Cadence Innovations is bankrupt. Again. Yucaipa was the lone wolf PE backer among the handful of hedge funds that brought the company, once known as Venture Holdings, out of Chapter 11 three years ago.
On The Left: From Churchill Capital’s weekly newsletter, further commentary on Unitranche. You may remember the instrument from a story I wrote on high yield (called “Sponsors Warm to Virtues of Simple Loans”), or from GE and Allied’s co-managed fund. Here is Churchill’s take on unitranche:
Blender Lenders: Issuers are increasingly considering unitranche as a mezz alternative. The one-document, blended senior/sub debt rate structure does eliminate inter-creditor issues, but the greater risk doesn’t suit all investors. Even a 10% yield won’t offset 4-5x total leverage.
mergermarket: In the wake of its Alltel merger, Verizon is selling between $3 billion and $4 billion worth of assets. Morgan Stanley is running the auction.
Debtwire: The news service reports that DE Shaw is hoping its troubled portfolio company, Foamex, can merge with another troubled bedding maker, Sleep Innovations. Easier said than done, it seems.
Venture Nashville via Dealscape: Buyout firms in fundraising, meet the Tennessee Consolidated Retirement System. They’ve got $900 million in fresh capital, just itching to be put to work in your alternative investment fund.
Naked Shorts: Fortress just gives up.