CIFC has hired JPMorgan Securities to assist in a strategic review that could see the credit manager being sold in a bid to improve shareholder value.
The firm is hoping to find a new investor that would help it expand, but keep the current management and platform intact, PDI understands.
Most of CIFC’s money is in collateralised loan obligations (CLOs), and the firm is looking to expand into Europe. Last year, it hired a senior portfolio manager and managing director for structured products, Robert Klein, and a head of corporate strategy, Julian Weldon. It also launched its CIFC CLO Co-Investment Fund II, with a target of $250 million.
Columbus Nova is the largest shareholder in CIFC, which is listed on NASDAQ, and it is unclear what will happen to the US family office’s 70 percent stake, although it is likely to decrease, PDI understands.
Columbus Nova did not respond to a request for comment at the time of publication.
CIFC converted from a C-Corp to an LLC on 31 December, making it ineligible for the Russell equity indices. The stock has traded down significantly in recent months, dropping from $8.35 per share in June to about $4.65 on Thursday.
Mergers and acquisition (M&A) activity in credit has risen recently. In November, global insurer Conning agreed to acquire CLO manager Octagon Credit Investors, while Sankaty Advisors bought a book of CLOs from Regiment Capital.
JPMorgan has advised on several credit M&A transactions recently, including many of the GE Capital sales.
CIFC, which was founded in 2005 and is based in New York, has about $14.2 billion of assets under management.