Amroc Investments, the distressed debt broker that was set to close last month, is still operating in a market confused about whether the firm ever ceased operations. Around Labor Day, Amroc Founder Marc Lasry said he had made the "bittersweet and gut-wrenching" decision to close Amroc so he could focus on his other business, Avenue Asset Management. But in the last few weeks, dealers started receiving axe sheets from Amroc and some said they received a message from Amroc saying "customers couldn't let us go."
So Amroc is back or never left -- and is doing business as before or not. Dealers say Amroc closed and is now back operating as a broker again. Lasry says Amroc never closed and is only buying bank debt for its own account and not dealing at all in bonds or other public securities.
Lasry said last week some in the market don't understand what had closed: The public broker-dealing business shut down in early September; the private trade debt operation is still running and never shut down. When Lasry said in September he was closing Amroc, he did not distinguish between the public and private operations of Amroc, saying that he was closing one business to focus on the other. The firm has laid off 20 salespeople that dealt with public securities. "Now we're talking to trade creditors. Trade debt is our primary focus."
Lasry said he does not recall any memo saying customers could not let go. "Last I checked, I run the firm, and I didn't send out anything," he said with a laugh. He also says the axe sheets dealers are referring to come from Amroc's interest in buying debt as an investor. "We're not dealing with clients. We're focusing on private debt. That's how the firm started, and we wanted to get back to our original focus," he said.
Some bank debt players are unsure of what Amroc's role is now. "I was just as surprised as anyone to see they're still in business," said a dealer. "I expected they'd say they're reshuffling their business, but it looks like the same firm, just with a lot fewer names." Another market player was confused over how Amroc had stepped out of its role as a brokerage firm. "We're seeing them as an intermediary business in a continuing sense. We see them in the middle of trades," he said. To this comment, Lasry replied, "I don't know."