Amid its battle for control of WorldCom, MatlinPatterson Asset Management has begun raising capital for a new distressed debt fund--with a target north of $2 billion. The firm has retained the private equity capital-raising firmAtlantic Pacific Capital to raise more than $2.2 billion, said an industry official familiar with the situation. First closing is expected in June, he added.
FormerCredit Suisse First Boston distressed debt prosDavid Matlin andMark Patterson left CSFB last year with a $2.2 billion distressed debt fund, said an industry official. They are seeking to bring the new fund at least to that size. The fund will buy distressed debt with the aim of taking control of troubled companies, the industry official explained. It is not being created to assist in the firm's WorldCom effort, the official added. MatlinPatterson is raising the new money because a glut of bankruptcy deals has caused availability of debt in the market, he said. An Atlantic Pacific official declined to comment. Calls to Matlin and Patterson were not returned