Secured Debt

SEC Charges Hedge Fund Icon Leon Cooperman With Insider Trading

When it rains - for hedge fund managers, it pours - If it's not lack of alpha, it's insider trading. Moments ago, the SEC charged iconic hedge fund manager, Omega Advisors' Leon Cooperman with insider trading, accusing him of generating substantial illicit profits by purchasing securities in Atlas Pipeline Partners (APL) in advance of the sale of its natural gas processing facility in Elk City, Oklahoma.

Three Years After Going Public, Fairway Files Chapter 11

Back in April 2013, during the height of the IPO scramble, the NYT gushed about Fairway's just concluded IPO: "Until recently, Fairway was not much more than a popular market on Manhattan’s Upper West Side, where residents went for goods like smoked salmon, medjool dates and cheeses. Today, it is a fast-growing 12-store grocery chain with ambitions of opening 300 outlets across the country." Just over three years later, the once successful IPO is now a distant memory and soon enough, so will the company behind it because overnight Fairway Group Holdings filed for Chapter 11 bankruptcy protection,

The Energy Junk Bond Default Rate Just Hit An All Time High

Following this weekend's bankruptcies of Ultra Petroleum and Midstate Petroleum which added $3.1 billion to the mushrooming high-yield energy bond default volume tally, in addition to the $1.5 billion of credit facility defaults, the energy high-yield default has soared to a record 13% rate, surpassing the 9.7% mark set in 1999, according to Fitch Ratings.

The New New 'Deal' - "Markets Are Too Important To Be Left To Investors"

In the same way that FDR had an existential political interest in generating inflation and preventing volatility in the US labor market, so does the US Executive branch today (regardless of what party holds the office) have an existential political interest in generating inflation and preventing volatility in the US capital markets. Transforming Wall Street into a political utility was an afterthought for FDR; today the relative importance of the labor markets and capital markets have completely switched positions. Today, the quote would be "markets are too important to be left to investors."

The Liquidity Endgame Begins: Whiting's Revolver Cut By $1.2 Billion As Banks Start Slashing Credit Lines

Whiting, the largest oil producer in North Dakota's Bakken shale formation, had $2.7 billion left on a loan revolver at the end of 2015. Its CEO Volcker said on Thursday he expects Whiting will have "at least $1.5 billion" left on the loan after the redetermination, implying a cut of $1.2 billion. What is most troubling is that as recently as late February, or just a few weeks ago, the company said it expected a cut of no more than 30%, which would have been roughly $800 million.

The "Surprising" Answer What Energy Companies Have Spent Their Newly Issued Equity Proceeds On

While the recent Weatherford example was indeed grotesque and extreme in its inherent conflicts of interest, some readers wondered if this was perhaps an isolated case. The answer: a resounding no: as the following table shows, the vast majority of new equity proceeds have been used almost entirely to pay down revolvers and existing debt, and to allow banks to reduce their exposure to these oil and gas companies.

UBS: "There Is No Doubt That The Move In Oil Is TOTALLY Short Squeeze Led", Here's Why

"Yesterday oil ended in the green despite a very large reported crude inventory build, a reflection of how biased to the downside sentiment and positioning already is. Today, crude started in the read and has been mixed from there but moving higher. And both days, the stocks have lead with energy the best performing subsector in the S&P. Now, there is no doubt that the performance today is TOTALLY short-squeeze led. Though it also shows how negative sentiment and positioning is."

"The Bankers Have Gone Through This Before. They Know How It Ends, And It’s Not Pretty"

Oil companies have sold $61.5 billion in stocks and bonds since January as oil prices have tumbled. However, the fees geneated are a tiny fraction of the bank's real exposure to the energy sector, at over $150 billion. So have the banks learned their lesson?  "The bankers have gone through this before,” says Oscar Gruss’s Meyer. “They know how it works out in the end, and it’s not pretty." Then again, perhaps banks are just sailing on an ocean of liquidity allowing them to postpone the day of Mark to Market reckoning, especially since this time, everyone is in it together....

Commodity Trading Giants Unleash Liquidity Scramble, Issue Record Amounts Of Secured Debt

In a furious race to shore up as much liquidity as possible, Glencore - which a month ago announced a dramatic deleveraging plan - and its peers have been quietly scrambling to raise billions in secured funding. Case in point none other than Glencore's biggest competitor and the largest independent oil trader in the world, Swiss-based, Dutch-owned Vitol Group, whose Swiss unit Vitol SA earlier today raised a record $8 billion in loans.