3i Infrastructure buys bonds from distressed hedge funds

Telegraph.co.uk – 3i Infrastructure, which is 43pc owned by private equity group 3i, said it had exploited an "anomaly in the market" and added it was keen to take part in any purchase of Gatwick, after BAA was told it must sell two of its three London airports.

The fund has bought debt issued by Ireland’s Viridian, Thames Water and Telediffusion de France, adding that the purchases offered higher than equity returns at lower risk.

Michael Queen, a 3i managing partner, said: "Hedge funds are receiving redemption notices and having to liquidate their portfolios. Because capital is scarce at the moment, the prices at which they’re [selling] are clearly at a discount to fair value.

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