The Distressed Debt Report - October 9, 2007

The near evaporation of institutional funding in the form of collateralized loan obligations (CLOs) and prime rate funds may be creating new opportunities for distressed private equity and debt investors. Full Story

Victims May Be Subordinated to Hedge Funds in Bankruptcy

A broker who worked for Citigroup and UBS is accused in a lawsuit of conspiring with the chairman of a breast implant company to steal more than $95 million from real estate exchange firms. Full Story

A group of hedge funds claim that Wachovia knew of severe financial problems at beverage-maker Le-Nature’s last year when the bank syndicated a $260 million loan to the company. In a lawsuit filed Sept. 17, the funds accuse Wachovia of syndicating the debt to reduce its exposure to Le-Nature’s. Full Story

• Renewable Energy Bust
• Arbess Hungry for Distressed Corporate Debt, Leveraged Loans
• Harbinger Takes Control of Bally
• American Tower Settles Fraud Suit with Bankrupt Subsidiary’s Creditors
• Kohlberg’s Borrowing Capacity Rises
• Morrisson, Sowell to Lead Babson Loan Team
• Timber Company Files $1B Reorganization Plan
• Corrections and Clarifications