It’s always fascinating to learn about companies based in New York and the activities that they are doing. Avenue Capital Group, founded in 1995 by the brother-sister team Marc Lasry and Sonia Gardner, works to achieve attractive risk-adjusted returns with their focus on the distressed debt and undervalued securities of US companies.
Their US strategy is focused in three main areas. They focus on companies in financial distress, those in bankruptcy and those that are undervalued because of discrete extraordinary events. As of the end of January, 2013, their assets under management allocated to the Avenue US strategy section were estimated to be around $5.5 billion.
As they explain on their website, “Avenue’s experienced investment professionals seek “good companies with bad balance sheets”— firms with sustainable businesses and positive cash flow but whose financial situation is distressed. The investment team conducts extensive research and analysis using Avenue’s top-down/bottom-up approach to find undervalued opportunities and typically seeks to make non-operational control investments in troubled businesses. This provides the strategy maximum trading flexibility and allows Avenue’s investment professionals to focus on pre-investment research and analysis rather than post-investment operating issues.”