London-based credit hedge fund Arini Capital Management has suffered a difficult year as concentrated positions in distressed European companies including Aston Martin and Altice International have weighed heavily on its flagship strategy, according to a report by then Financial Times.
The report cites unnamed people familiar with the firm’s performance as highlighting that the $22bn manager’s master fund is down more than 8% since the start of the year, following losses of almost 8% in July and close to 1% in August.
The setback marks a sharp reversal for Arini, which was founded in 2021 by former Credit Suisse high-yield trader Hamza Lemssouguer and quickly established itself as one of Europe’s fastest-growing credit hedge funds.
The firm’s strategy centres on taking sizeable, often leveraged positions in distressed and high-yield debt, with Arini frequently becoming one of the largest creditors of companies facing financial pressure. That approach generated returns of 27% in 2023, 21% in 2024 and 10% last year.
But several of its recent positions have moved sharply against the fund.
Altice International was Arini’s largest single-name source of losses in July. The bonds of the telecoms group, part of Patrick Drahi’s wider empire, had already fallen heavily after valuable assets were moved beyond the collateral available to creditors.
The fund was also hurt by developments at Aston Martin. The heavily indebted carmaker transferred valuable naming and branding rights outside the reach of creditors owed more than £1.3bn, sending its bonds sharply lower.
The manager has previously demonstrated an ability to recover from significant drawdowns. Its flagship strategy lost about 8% over two months in early 2024 before gaining roughly 29% over the subsequent year. It also suffered a 15% decline over several months soon after launching in 2022, but generated an overall return of approximately 73% during its first four years.
Performance has been stronger across some of Arini’s other strategies this year. Its credit opportunities fund is up about 12% year to date, while its direct lending strategy has returned approximately 7%, according to people familiar with the figures. The firm also operates an asset-backed finance strategy.
