The Distressed Debt Report - March 27, 2007

Bank Cites N.C. State Law Against Litigation Claims Trading

A lawsuit filed by Wachovia Corp. in state court in North Carolina could ultimately disrupt the entire U.S. secondary trading market for distressed debt. That is the fear of legal observers, the main trade group for the syndicated loan market, and investment firms including Harbinger Capital Partners and UBS who are named as defendants in the bank’s lawsuit. Full Story

Farallon Provides Bridge Financing to Accredited Lenders

To most of the financial markets, the subprime mortgage industry appears to be imploding, and to possibly be a threat to the broader economy. But at least a few key players in the secured debt market seem to see subprime mortgages as still a hot opportunity. Farallon Capital Management, for one, agreed to provide a $200 million term loan to Accredited Home Lenders Holding Co. last week and said that it held talks about possibly acquiring the San Diego-based mortgage company. That was after Accredited’s auditors expressed concern about its chances to survive. Full Story

Polygon to List $1.3B Tetragon Fund in Amsterdam, Newspaper Says

As more alternative asset managers look to the public stock market for capital, a U.K. manager is reportedly planning to offer shares in a $1.3 billion fund of syndicated bank loans. Full Story

• Former GE Executive Starting New Investment Firm
• New Loan Structures Meant to Limit Lenders' Risk
• Bankrupt Companies Using Disclosure Rule to Thwart Activist Funds
• CIT Vice Chairman Resigns
• Lehman Buys Stake in D.E. Shaw
• Black Diamond, Brencourt Bid $265M for Werner
• American Capital Prices $129M Stock Offering
• GSO Capital Takes Over FriedbergMilstein Assets

LodgeNet Syndicates $450M for Acquisition

Gray Television, an operator of 36 local television stations, said it refinanced its senior credit facility last week with $1.025 billion in new revolving and term loan facilities. Full Story