Market Cheat Sheet Jan. 12, 2019

Market Cheat Sheet

“An ESL spokesman said in a statement Friday that through an affiliate, Transform Holdco LLC, the firm submitted an offer for roughly 425 Sears stores, for a total value of $4.4 billion… The bid includes a $1.3 billion financing commitment from three financial institutions, ESL said. The banks that agreed to extend the maturity on a $1 billion loan to beyond Sears’s bankruptcy include Bank of America Corp. and Citigroup Inc., people familiar with the matter said. ESL’s current bid also calls for ESL to forgive or extend maturities on most of Sears’s debt, according to one of the people… As part of the financing package, ESL and Cyrus Capital Partners LP are giving Sears a new loan of over $200 million backed by some Sears properties, one of the people said… Liquidation firms Tiger Capital Group LLC and Great American Group LLC teamed up to place a liquidation bid, with the option of joining with other liquidation firms, people familiar with the matter said. Meanwhile, Gordon Brothers Retail Partners LLC and Hilco Global Merchant Resources LLC joined forces in another bid” – WSJ

“A $2bn loan fund that was once managed by Blackstone has seen its market value plunge by more than a quarter since private equity rival KKR took over management of the vehicle in April. The stark reversal at Franklin Square Investment Corp highlights the uncertainties facing credit funds that have displaced banks as major lenders to the midsized companies that are the economic engine of middle America… Shares in FS-KKR declined 29 per cent between April and mid-December, when it merged with another KKR-managed vehicle, making direct comparison more difficult. Most of its peers have also fallen, but by far less. Funds run by Ares Management and Golub Capital recorded single-digit declines.” – FT

The Best Investments of 2018? Art, Wine and Cars – WSJ

The Money Managers to Watch in 2019 (David Einhorn; Daniel Sundheim; Kathleen Murphy; Mark Wiseman) – WSJ

“The world’s largest exporter of crude oil is planning to cut exports to around 7.1 million barrels a day by the end of January, down 800,000 barrels a day from November levels, according to OPEC officials. The move is part of an effort to boost prices above $80 a barrel so the kingdom can better meet its budgetary requirements… Prices have also been supported at the start of the year by the implementation of production cuts from the Organization of the Petroleum Exporting Countries and its allies. Saudi Arabia, the de-facto head of the oil cartel, has led the way on those output curbs. OPEC and 10 external producers, led by Russia, agreed in early December to collectively cut output by 1.2 million barrels a day for the first half of 2019 to mop up a supply glut.” – WSJ

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