Noteholders Vote For Manager Change On $1.3 Bln CDO

  • 02 Dec 2001
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Investors in Indosuez Capital Funding IV, a $1.3 billion collateralized debt obligation managed by Crédit Agricole Indosuez, reportedly voted to switch management over to Royal Bank of Canada last week, citing the defection of portfolio manager Dan Smith and other key staff to RBC last month. Smith confirmed that a majority of the controlling noteholders has rejected Crédit Agricole Indosuez as the fund's current manager and appointed RBC as the successor on the deal, but declined further comment. But Paul Travers, portfolio manager at Crédit Agricole Indosuez, said a new management team is not managing the fund. He declined to comment on whether a vote had taken place to supplant the deal's management team, but said, "We have not lost any funds. We are managing the funds as if we will own them forever."

As first reported on LMW's Web site last week, other funds with key management triggers include Indosuez Capital Funding VI, Porticoes Funding, and Serves 2001-Limited. Right now, a market source said the voting process is taking place on Funding IV and on the Serves deal while the Porticoes deal has a wider time frame built for a change. The key management trigger on certain deals allows noteholders 30 days to vote to hire a new management team if one is replaced. A 51% majority is needed and once met the trustee of the deal, through the special purpose vehicle, makes the management change. Chase Manhattan is trustee on the Indosuez transactions.

  • 02 Dec 2001

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Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 Citi 7,171 21 10.72
2 Bank of America Merrill Lynch (BAML) 6,901 20 10.32
3 JP Morgan 4,776 10 7.14
4 Credit Suisse 4,718 9 7.05
5 Lloyds Bank 4,420 14 6.61

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1 Wells Fargo Securities 68,611.22 170 11.38%
2 Bank of America Merrill Lynch 59,056.08 169 9.80%
3 JPMorgan 56,861.85 163 9.43%
4 Citi 56,521.05 165 9.38%
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