Solus Alternative Asset Management LP didn’t kill Toys “R” Us Inc., the hedge fund said in a letter to its investors after coming under pressure for its investments in the liquidating retailer, Bloomberg News reported. “Solus did not force Toys ‘R’ Us to liquidate,” Chief Investment Officer Christopher Pucillo said in the Sept. 6 letter seen by Bloomberg News. “It was the culmination of a host of factors, including a decade-plus of excessive leverage, mismanagement and the increasing effects of competition from the likes of Amazon and Walmart.” The two-page letter lays out a timeline and narrative to rebut allegations that the refusal of Solus and other creditors to compromise on their investments forced the company to wind down when it could have lived on through a sale. New York-based Solus invested $20 million in a Toys “R” Us loan before its bankruptcy and added stakes in its senior debt after the chapter 1u1 filing, according to the letter. As the company closes its operations, Solus has attracted criticism from worker groups who say they deserve hardship pay after losing their jobs and that Solus and other lenders share the blame for the company’s failure to restructure.
Luxury retailer Neiman Marcus Group Ltd. has transferred shares of its MyTheresa online subsidiary to its parent holding company, a move that pressured the company’s bonds yesterday, WSJ Pro Bankruptcy reported. Before the transfer of MyTheresa to the parent company, Neiman Marcus Group Inc., there was some anticipation that the retailer would use the MyTheresa shares to entice bondholders to swap their debt for bonds with a longer maturity. “Some bondholders may have incorrectly assumed that the company would embark on a distressed debt exchange involving MyTheresa shares as collateral,” said Steven Ruggiero, an analyst at Pressprich & Co. The company has $4.7 billion in debt.
The New York State attorney general's office has referred three cryptocurrency exchanges to the state’s financial regulator for possible legal action and raised concerns over price manipulation and conflicts of interest on trading platforms, Politico reported. In a report on virtual currencies released yesterday after months of information gathering, the attorney general said the exchanges — Kraken, Binance and Gate.io — may be operating without the special BitLicense that the New York Department of Financial Services requires for cryptocurrency firms. The report claims they do not have appropriate controls to prevent consumers from using their services in the state, which would violate New York law. Much of the information in the report was collected by directly contacting exchanges. Outside of the three referrals for investigation, the other findings could have a broad impact on the burgeoning industry. The report concludes that “virtual asset trading platforms have yet to implement serious efforts to monitor and stop abusive or manipulative trading.” Read more.
Don't miss the "Cryptocurrency, Blockchain and Other Breaking News" session at ABI's Winter Leadership Conference in December. This panel will discuss the impact of cryptocurrencies on the financial industry and how to litigate the complex issues they bring. Click here to register.
A top securities regulator is calling for his agency to beef up its oversight of the nation’s stock exchanges to root out conflicts and curb rising fees that he says are harming investors, the Wall Street Journal reported. In a policy speech to be delivered Wednesday, Robert J. Jackson Jr., a Democratic commissioner at the Securities and Exchange Commission, will allege that the SEC has “stood on the sidelines” as the New York Stock Exchange, Nasdaq Inc. and other market operators have significantly boosted their profits while raising investors’ costs, according to a copy of his remarks. Jackson will call on the SEC to ensure “that the exchanges’ actions do not unduly burden competition and are fair and reasonable.” All of the currently active U.S. stock exchanges are for-profit enterprises, a reversal of the way the stock market operated for nearly two centuries. The NYSE, for instance, was a member-owned nonprofit until 2006 and was later acquired by Intercontinental Exchange Inc., an Atlanta-based global exchange operator. Critics charge that for-profit exchanges exploit their central position in the markets to extract greater fees from traders.
Real Estate September 2018
Young and New Members September 2018