Eldridge’s CBAM Targets $500 Million Fund for Crisis-Hit Debt

(Bloomberg) -- CBAM Partners, part of Todd Boehly’s Eldridge Industries empire, is seeking to raise a new $500 million fund to sweep up downtrodden debt in the greatest credit dislocation in more than a decade.

The fund will buy bonds and syndicated loans in both primary and secondary markets, as well as collateralized loan obligation equity and mezzanine paper in the secondary, according to a person with knowledge of the matter. CBAM is in the process of raising cash for the opportunities fund, the person said, asking not to be identified discussing a private matter.

The pandemic has dragged down asset prices across the board with few industries immune to the global lockdown’s grasp. Investors are spying opportunities to seize discounted debt that others have been forced to sell, with Oak Hill Advisors, Oaktree Capital Group and Fortress Investment Group LLC raising billions of dollars of cash on a wager that some prices will recover.

A representative for New York-based CBAM declined to comment.

CBAM’s fund, which has a two-year lockup period, will also buy stressed assets that don’t require a restructuring to unlock value, as well as revolver and bridge loans that companies may seek to shore up liquidity amid a collapse in earnings during the outbreak.

Alternative investment management firm CBAM was set up by Don Young, Mike Damaso and Jay Garrett in 2016 and has more than $12 billion in assets under management. The firm manages CLOs, which package and sell leveraged loans into bonds of varying risk and return, and sold its 11th deal late last year.

Young and Damaso will run the fund. Young previously worked at Och-Ziff Capital Management Group, since renamed Sculptor Capital Management, and Octagon Credit Investors. Damaso is an alumni of Guggenheim Investments.

Investment firm Eldridge was started by ex-Guggenheim president Boehly. The empire includes Security Benefit, an insurer that had more than $41 billion of assets at the end of last year, the Hollywood Reporter, the Beverly Hilton, a 7% stake in the Los Angeles Dodgers and a minority stake in fantasy sports betting platform DraftKings.

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