Approach

Within the $4 trillion North American levered credit universe, we focus on companies with an enterprise value of $250 million to $1.0 billion

  • Axar believes middle market opportunities will continue to be robust, independent of the economic cycle, as a certain number of companies will make mistakes and struggle with leverage
  • Axar has found limited competition from hedge funds and other opportunistic investors in this arena

There have been at least

450

US bankruptcies per
year since 2011

Source: S&P Global Market Intelligence

96%

of them are

companies with less than $1b of liabilities

Source: S&P Global Market Intelligence

There have been at least

450

US bankruptcies per
year since 2011

Source: S&P Global Market Intelligence

96%

of them are

companies with less than $1b of liabilities

Source: S&P Global Market Intelligence

The Axar Focus

We look for three types of situations:

Fulcrum securities where a restructuring is anticipated or in progress

Solvent companies undergoing industry-wide or other macro pressure. Dislocations often derived from corporate events, regulatory change or industry pressure

Other types of investments with asymmetric return profile and hard catalysts. Opportunities may involve direct lending and can occur before, during and/or after a credit or other corporate event

Fulcrum securities where a restructuring is anticipated or in progress

Solvent companies undergoing industry-wide or other macro pressure. Dislocations often derived from corporate events, regulatory change or industry pressure

Other types of investments with asymmetric return profile and hard catalysts. Opportunities may occur before, during and/or after a credit or other corporate event

We focus on companies facing significant cyclical pressure or business uncertainty and seek investments that we believe meet three conditions:

1

1

Deep discount to our view of intrinsic value

This opportunity is generally created when there is a high degree of situational uncertainty and/or a forced sale

2

2

LOW PROBABILITY OF PERMANENT CAPITAL IMPAIRMENT

We look for situations where we believe we are highly likely to recover most if not all of our investment in a worst-case scenario, such as liquidation

3

3

STRONG UPSIDE POTENTIAL WITH A FACILITATING CATALYST

We select investments that we believe have significant appreciation potential as well as an identifiable catalyst. Our preferred catalyst is debt maturity