The firm also spent time on travel and leisure, chemicals, and event and ticketing-related businesses. The majority of Bardin Hill’s capital is invested in secured debt, Dillow said. It looks to finance operating companies, adding positions that are ahead of existing creditors in line for repayment.
Diameter Capital
Diameter posted a return of 24% at its main $5 billion hedge fund. A $1 billion draw-down fund that started in April gained about 47% through December.
The firm saw some of its biggest wins from travel credits and software loans. The credit manager participated in Hertz’s bankruptcy and bought debt tied to Carnival Corp. The firm also bought a chunk of investment-grade bonds in March to capitalize on cheap valuations for healthier companies amid the turmoil.
New York-based Diameter was founded by partners Scott Goodwin and Jonathan Lewinsohn in 2017. The firm invests in securities including in high-yield and investment-grade bonds, loans and credit-default swaps.
Knighthead Capital
Distressed-debt shop Knighthead gained 15% in its flagship fund last year. The $4.5 billion firm, run by Tom Wagner and Ara Cohen, saw its drawdown fund surge, bringing its internal rate of return since its mid-2019 inception to 55%.
Knighthead’s returns were driven by investments in Sabre Corp., PG&E Corp., Azul SA, Latam Airlines Group SA, Marathon Petroleum Corp. and pipeline bonds.
Mudrick Capital
Mudrick Capital Management, which manages $2.8 billion, gained about 12% in its flagship hedge fund, making much of its money in the fourth quarter.
The fund’s returns were driven in part by a CMBX 6 short bet, and it also made money on investments in Gogo Inc., Ligado Networks LLC, and AMC Entertainment Holdings Inc. The hedge fund recently committed to lending $100 million to the world’s largest movie theater chain. Mudrick also sold its position in cxLoyalty Group Holdings Inc. to JPMorgan Chase & Co. for a profit.
The New York-based firm was founded in 2009 by former Contrarian Capital Management money manager Jason Mudrick. The firm is expanding further into Europe with the takeover of a credit hedge fund previously run by CVC Credit Partners, Bloomberg reported earlier.
Redwood Capital
Redwood Capital Management gained 10.7% at its main Redwood Master Fund through year-end. Redwood’s second drawdown fund posted an internal rate of return of 45% for 2020.
Redwood, which manages $7 billion, had less than one-fifth of the cash in its $1.5 billion drawdown fund deployed before the Covid-19 crisis rattled markets, Bloomberg reported. It invested $1.3 billion from late February through late September as markets and the economy were roiled by the spread of the virus, according to an investor letter.
The fund put money to work in hard-hit industries like hospitality, cruise ships, real estate and aerospace. It also invested in Argentina and purchased healthier investment-grade securities and leveraged loans as risk premiums blew out. Specific bets included Cheniere Energy Inc., Ford Motor Co., SoftBank Group Corp., Marriott International Inc. and real estate investment trust Vereit Inc., the letter said.