WEST PALM BEACH, FL (www.hedgeco.net) Hedge Funds have scored big victories with their acquisition of Air Canada�s distressed debt by succeeding in converting such debt instruments into stock.According to news reports, several hedge funds mostly from North America and Europe have helped Air Canada maintain better footing when they succeeded in converting the company�s significant debtinto stock in the airline�s new parent company, ACE Aviation Holdings Inc.
Top investors in the new ACE Aviation Holdings Inc include �U.S. mutual fund giant Franklin Templeton Investments of San Mateo, Calif., which held a 6.5-per-cent stake, and Germany’s Deutsche Bank AG, which had 3 per cent,� according to industry sources and regulatory filings.
Others with significant shares in the new company include the York-based Quadrangle Group LLC, London-based Marathon Asset Management Ltd., Pittsburgh-based Mellon Financial Corp, and Glencore Finance AG of Switzerland and Varde Partners Inc. of Minneapolis. ACE stock was recently valued at $20 per share. Many other hedge funds also acquired additional shares through other arrangements according to the report.
An industry source commenting on role of hedge funds in the process said, “This is a snapshot in time.” But the source also noted that some of the hedge funds have been slowly reducing their stake in the new company. Hedge funds did well in placing their bets on the recovery of Air Canada; the deal was a remarkable success. The source noted, “There’s no doubt about it. This was a tremendously successful restructuring in the final legs.�
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net
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