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New Firm Plans Advisory, Asset Management & Monoline Biz

Cairn Capital, a new asset management firm in London run by well-known credit veterans, is taking what it calls a unique approach and plans to offer three distinct capabilities: structuring/advisory, asset management and financial guaranty.

Cairn Capital, a new asset management firm in London run by well-known credit veterans, is taking what it calls a unique approach and plans to offer three distinct capabilities: structuring/advisory, asset management and financial guaranty. Cairn was incorporated in February and received authorization from the U.K.'s Financial Services Authority at the end of July. Seed capital for the firm was provided by Royal Bank of Scotland and Star Capital Partners.

The five-strong management team includes Paul Campbell and Robert Pierce Jones, both previously managing directors for Europe at Banque AIG, the European subsidiary of AIG Financial Products, as well as David Littlewood, David Henriques and Tim Frost (BW, 8/9). All are seasoned players in European structured finance and asset management, each boasting about 15 years of experience in the markets. Five more professionals are on board and another 10 hires are planned, said Campbell, bringing the team to 20 by year-end.

Frost and Campbell are leading the asset management business. The team will both manage and invest in collateralized debt obligations backed by a wide range of assets, as well as run credit funds with a degree of leverage; a more traditional credit fund will be added next year. Cairn is targeting $2.5 billion is assets under management by the end of this year.

Cairn's structuring and advisory business, which covers synthetic CDOs, real estate financing and other structured credit products, is up and running. The effort, spearheaded by Pierce Jones, Henriques and Littlewood, has already five executed mandates, according to Pierce Jones.

The third prong of the business, financial guaranty, will be launched next year and will include a monoline wrap capability as well as reinsurance. The management team is currently conducting a feasibility study to assess the financial returns of the proposed business

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