Each business day HedgeCo.Net keeps you informed with the top hedge fund industry news, opinion and insight from around the globe. From the latest hedge fund launches, to the impact of regulation, competition, and investor activism - we track the topics and people that make a difference to you.
Philadelphia Bulletin – Chrysler LLC dissident lenders must reveal their identities by 10 a.m. today, a bankruptcy judge ruled, rejecting claims that their safety was at risk.
U.S. Bankruptcy Judge Arthur Gonzalez in New York forced the group to file a list of its members publicly, denying their request to reveal their identities only to the bankruptcy court. Judge Gonzalez said the lenders have no evidence that keeping their identities private would help protect them. The group seeks to block an auction of most company assets to an entity managed by Fiat SpA, an outcome Chrysler said would force it to liquidate, costing thousands of jobs.
Reuters – The U.S. Treasury raised its offer by $250 million (168.9 million pounds) in debt restructuring talks with Chrysler lenders on Wednesday as part of a final push to win over lenders holding out for better terms and avoid bankruptcy, two people person briefed on the closed-door talks said.
The lenders had until 6 p.m. ET to vote on the offer, which was made late Wednesday afternoon, one of the sources said.
Herald Tribune – The Treasury Department has increased its offer to repay Chrysler’s senior lenders as part of continuing talks on how to reduce the company’s debt, a person who had been briefed on the talks said on Wednesday.
The government’s new plan, however, still shows a broad chasm between the two sides as Chrysler races to complete a reorganization plan by April 30 or face a near-certain liquidation through bankruptcy.
Daily Times – Banks and hedge funds that hold $6.9 billion in Chrysler LLC debt have proposed forgiving $2.5 billion of it in exchange for about a 40 percent stake a Chrysler-Fiat alliance, according to two people briefed on the proposal.
One of the people said the lenders delivered their counterproposal to Chrysler and the U.S. Treasury Department late Monday night. Neither person wanted to be identified because the negotiations are private.
Bloomberg – The Group of 20 leaders will agree on new rules to rein in hedge funds and may more than double the resources of the International Monetary Fund, U.K. Chancellor of the Exchequer Alistair Darling said.
“There is a recognition that some hedge funds are systemically important,” Darling told Bloomberg Television in an interview today in London. “There will be an agreement there. Where you’ve got something that’s systemically important like a hedge fund, you need to know what’s going on there.”
Prime Minister Gordon Brown has struggled to allay the concerns of German Chancellor Angela Merkel and French President Nicolas Sarkozy as they press for a crackdown on traders and lenders. Darling’s comments suggest consensus is now emerging among G-20 leaders in the London talks on measures to combat the financial crisis.
Times Online – Secretive hedge funds will eventually be subject to the same supervisory rules as banks, under a tightening of Britain’s system of regulation.
The changes, which will require banks and other lenders to build up their reserves in healthy economic times, could become the basis for international efforts to overhaul regulation at the G20 summit in London on April 2. The moves will be proposed on Wednesday in a report by Lord Turner of Ecchinswell, chairman of the Financial Services Authority, who will call for an overhaul of the tripartite links between the FSA, the Bank of England and the Treasury.
They follow repeated pledges from Gordon Brown for a crackdown on the “shadow banking system”.
Forex Pros – Private equity firm TowerBrook Capital said on Monday it had reached an agreement to take control of French debt-ridden auto parts firm Autodistribution Group.
The deal, at a time of slumping sales in the European car industry, will see Autodistribution’s debt slashed and new management brought in.
A majority of lenders have accepted a debt-for-equity swap, which will reduce the company’s debt from approximately 600 million euros ($755.6 million) to 140 million euros, a source familiar with the transaction said.
TowerBrook said it would obtain a 62.5 percent stake, the lenders would hold a 21.5 percent stake, while Bahrain-based private equity firm Investcorp, the company’s previous owner, would retain a 16 percent stake.
The U.S. government announced a restructuring of a bailout plan for the troubled insurer American International Group Inc. Monday, extending $30 billion in additional aid to the company.
News of the additional funds comes as AIG, once the world’s largest insurer, said it lost $61.7 billion in the fourth quarter, the biggest quarterly loss in U.S. corporate history, amid continued financial market turmoil.
Times Online – Oaktree Capital Management, a specialist investor that targets heavily indebted companies owned by buyout groups, has sealed its first big investment in Britain.
The American-based Oaktree, which has just under €1.8 billion (£1.6 billion) to spend on distressed European companies, said on Tuesday that it had signed a deal to buy a large stake in Countrywide, the estate agency chain taken private for £1 billion at the height of the buyout boom by Apollo, the US private equity fund.
The deal, in which lenders to Countrywide will write off nearly £600 million of its debt mountain, will raise hopes that distressed investors could begin to make an impact on Britain’s stalled buyout market.
