Highland Capital Management is planning to expand into the structured products business and has brought on board Dansby White, formerly managing director and head of structured finance and CDOs at Merrill Lynch. "The objective is to grow Highland's offerings in the structured products arena and meet investor demand," noted Jack Yang, a partner at Highland. Yang explained this increased interest in structured products is coming from investors looking for yield and also as a diversification tool.
Highland currently has approximately $10 billion in assets under management. This is primarily invested in leveraged loans, but is also in high-yield bonds and special situations. The firm manages the assets through CDOs, hedge funds and separate accounts. Highland also recently bought the bank loan business of Columbia Management Advisors, which includes mutual funds.
The new products will have a particular focus on public securities, said Yang. These could include corporate bonds and derivative products, though White and Yang both declined to elaborate on any specific areas. "Our focus is on situations and market conditions where we see value. It's a moving target where the value proposition is attractive," White explained. The aim is to do at least a deal or two a year, though the number of deals and volume is less important than the value created to investors, he added. "Dansby has a large mandate. There is no shortage of opportunity out there," Yang stated.