Arb Traders Feel the Pain of LBO Debt Headaches
A trader works on the floor of the New York Stock Exchange (NYSE) in New York, US, on Friday, Aug. 26, 2022.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
Hi there, it’s Yiqin Shen in New York. In today’s newsletter, I’m looking at my latest survey with arb investors who are concerned that the leveraged debt market’s fallout is hurting their deal bets. Elsewhere, the Musk saga continues, while Credit Suisse may be moving forward with a spinoff of its investment bank.
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It’s been a bumpy year for merger arbitrage traders. The Citrix buyout was just completed by the skin of its teeth. The Twitter saga appears to be headed for a resolution but the financing still looks hairy. And now, Tenneco’s deal with Apollo is shaping up as the next battleground.