Arini Capital Management Debt Sale and Portfolio Losses
Arini Capital Management has sold approximately $800 million of debt holdings in recent weeks after mounting investment losses triggered margin calls from its banking lenders, according to people familiar with the matter cited by the Wall Street Journal.
The hedge fund’s flagship portfolio, which manages roughly $7 billion, had declined by more than 20% year‑to‑date as of mid‑October, and further declines were expected by the end of the month.
The losses are largely attributed to concentrated positions in distressed telecommunications companies, specifically Altice International, Optimum Communications Inc (NYSE:OPTU), Virgin Media and Brightspeed. Optimum Communications is approaching a potential Chapter 11 bankruptcy filing, while Brightspeed is also considering similar proceedings before year‑end.
Arini has been liquidating more marketable investments to satisfy margin requirements linked to credit default swap indexes and other leveraged positions. Those indexes track European corporate debt, which has been pressured by rising interest rates and concerns over France’s fiscal position.
Additional troubled investments disclosed include luxury automaker Aston Martin Lagonda Global Holdings PLC (LON:AML), packaging firm Multi‑Color, and building‑products manufacturer Cornerstone Building Brands. The fund recently exited a position in veterinary‑hospital operator Pathway Vet Alliance and had previously sold stakes in Intrum and the Ritz‑Carlton Yacht Collection.
Founded in 2021 by former Credit Suisse trader Hamza Lemssouguer, Arini has expanded from a $1.3 billion specialist hedge fund into a $22 billion alternative‑asset manager. Approximately one‑third of its assets are allocated to collateralized loan obligation (CLO) funds, which continue to perform well. The firm also recently closed its first direct‑lending fund, targeting about $4 billion of European middle‑market investments.
In personnel news, Gavin Yates, who previously headed Arini’s U.S. business, left the firm in August and is expected to establish a distressed‑debt team at Citadel in the coming year.