British credit asset management and advisory firm Cairn Capital Group is set to acquire and combine with Bybrook Capital, a London-based specialist distressed credit manager.
The consolidation will lead to the formation a diversified alternative credit manager with AUM of nearly $8bn.
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The transaction, whose financial details were undisclosed, is expected to be finalised in the second quarter of this year. It is currently pending regulatory nod.
In concurrent with the deal, Mediobanca, which owns a majority stake in Cairn Capital, will acquire a 64% stake in the combined firm reaffirming its position as the majority shareholder.
The remaining 36% will be owned by former shareholders of Bybrook and current minority shareholders of Cairn Capital.
Furthermore, Bybrook partners will remain significant investors in their funds and become minority shareholders in Cairn Capital.
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Founded in 2014, Bybrook specialises in the absolute value stressed and distressed debt and special situations in Europe and manages over $2.5bn on behalf of institutional investors.
The merger with Bybrook will enable Cairn Capital to position itself a diversified alternative credit manager with around $8bn AUM in public, private, performing and distressed investment segments.
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Cairn Capital CEO Nicholas Chalmers said: “We are delighted at the prospect of merging with an outstanding firm that has a proven track record of delivering differentiated and strong absolute returns to institutional investors.
“We are confident that the combined fundamental credit research capabilities and complementary skills will greatly enhance the investment process and our ability to consistently deliver exceptional returns throughout the cycle.”
Bybrook CIO Robert Dafforn said: “The Bybrook partners are extremely pleased to be joining forces with Cairn Capital.
“As one of Europe’s leading CLO franchises for many years, Cairn Capital provides Bybrook with even broader research coverage, which is sure to drive strong returns within stressed/distressed and special situations over the years to come. We are excited that we will be able to provide full credit markets solutions to clients via the enhanced and expanded platform.”
Mediobanca CEO Alberto Nagel said: “With the acquisition of Cairn Capital in 2015, RAM Active Investments in 2017 and Bybrook today, Mediobanca keeps building an Alternative Asset Management platform which today manages roughly $10bn in AUM, focusing on specialist affiliates, adding value to their clients within the Group’s distribution networks and beyond.”
