Marathon taps into distressed credit opportunities with new strategy
New York-based Marathon Asset Management is zeroing in on a broad range of special situations opportunities arising from the coronavirus pandemic fallout with the launch of a new distressed strategy, the Marathon Distressed Credit Fund.
The fund, which has closed with around USD2.5 billion worth of commitments, aims to provide capital solutions for companies in stressed and distressed situations to grow or reposition themselves. Marathon has some USD20 billion of assets under management.
The assortment of opportunities, which stem from the varying paces of recovery across different industries and sectors, include restructurings, debtor in possession financings, and exit financings.
Louis Hanover, CIO of Marathon, said: “Following a prolonged economic expansion marked by mispriced risk and heavily levered capital structures with weak documentation we are presented with an optimal investment environment to prudently and opportunistically deploy capital.”
Despite the broader market recovery, Bruce Richards, Marathon’s chairman and CEO, pointed to a K-shaped recovery which has resulted in a “disparate impact” which calls for “tailored capital solutions” across different sectors affected by 2020’s cyclical decline.
“Companies that are well positioned for future growth may need a thoughtful and sophisticated capital partner to navigate the downturn, even in the event it may require a consensual restructuring,” Richards observed.
Jason Friedman, partner and head of corporate strategies at Marathon added: “As we progress into the latter stages of the turn in the credit cycle, there exists a varied set of opportunities to deliver our expertise and capital to strong companies backed by secular growth drivers that are confronting cyclical headwinds.”