Tuesday, October 9, 2012

Giant Greek deal masks slow restructuring market

 A mandate advising Greece on its mammoth $263.1bn debt exchange has handed Blackstone and Lazard an almost unassailable lead at the top of the restructuring rankings for 2012, in what has been an otherwise quiet market for restructuring activity.

 
Completed distressed debt and bankruptcy activity globally totalled $364.1bn in the first nine months of the year, according to Thomson Reuters, up more than 200% from the same period last year.
 
This increase was largely driven by a single deal – the $263.1bn debt exchange undertaken by Greece, which is the largest restructuring deal on record.
Greece announced in April that 96.9% of its lenders had agreed to the debt restructuring demanded by its international creditors in exchange for a bailout. Investors holding around €6bn of Greek debt at the time refused the debt writedown. Since then, there have been reports than another debt restructuring may be necessary.

The deal helped Blackstone and Lazard to the first and second places, respectively, in the global completed distressed debt and bankruptcy restructuring rankings for the first nine months of the year, with each posting more than $290bn in deal credit.
 
Houlihan Lokey, which ranked top at this stage last year, fell to third with $32.9bn in activity, with Rothschild fourth and Moelis & Co fifth. In Europe, Lazard ranked top, followed by Blackstone and Rothschild.
 
Without that one deal, global activity would have fallen by more than a third, down to $101bn from $155.1bn in the same period last year. In Europe, total volume excluding sovereign debt was down almost a half on the year period.
 
Similarly, the number of deals, at 337, was down sharply from the equivalent period last year, with 284 fewer deals. Rothschild ranks the table by deal number, with Lazard second and Houlihan Lokey third. Blackstone and Moelis & Co round out the top five.