Simplon Partners LP is for US residents and Simplon International Limited is for offshore residents. The funds, which currently have $200 million of assets under management, have been in existence for twenty-one years and concentrate on situations with market capitalizations of under $500 million where pricing inefficiencies are most likely to occur. Generally the strategy is to acquire bonds, bank debt or trade claims at a discount to face value and hold them until a Chapter 11 plan of reorganization (or other financial restructuring) can be completed to deleverage the balance sheet of an otherwise healthy business. This process often takes over a year, so that realized gains are generally long-term, providing favorable tax treatment for domestic investors. The focus is on the most senior claims in a company’s capital structure to limit downside risk and the funds never use margin loans or other leverage. The funds do not seek control positions in any of their investments but, when needed, the principals may serve on creditors’ committees or corporate boards.
For further information, please contact
T.A. McKay & Co., Inc.
One Rockefeller Plaza, Suite 1712
New York, N.Y. 10020