Friday, October 31, 2014

Holders of Dendreon Bonds

According to 13-Fs, as of 6/30 the largest holders were:

  • Deerfield Management, $223 million face [36% of outstanding]
  • Empyrean Capital Partners, $97 million
  • Partner Fund Management, $68 million
  • Aristeia Capital, $66 million
  • Waterstone Capital Management, $35 million
  • Wolverine Asset Management, $30 million
Those six own $520 million worth, which is 84% of the whole issue.

Deerfield claims to manage $5 billion in public and private equity funds. The Dendreon bonds are actually the largest investment on their 13F. They must be really bullish on Provenge, and they don't own any common stock. They may want to wind up owning the company in a restructuring. I would imagine they will be leading the eventual negotiations about how much of the company bondholders will get.

Empyrean manages several billion, and their 13F shows all the classic long/short hedge fund stocks like Allergan and Yahoo. They also own Quicksilver Resources, a terrible energy name with bonds now trading at 25 whose stock has gotten crushed. They own so much DNDN debt that a exchange into equity would probably be the best way out of the position, if they wanted to.

Partner seems like yet another $5 billion dollar fund that owns the typical big fund stocks too (13F): Google, Allergan, Priceline, Netflix, Microsoft, and lots of healthcare/pharma names. This is a tiny position for them but a pretty big piece of the DNDN issue.

Aristeia was in the Genco Shipping trade. They do capital structure arbitrage. They own (13f) other distressed names like VRS, MCP, but also momentum like TSLA.

It ought to be possible for the company to get these holders to agree to take over the company through a distressed debt exchange.


jHurt said...

helluva drug. $100K to extend your life for 4 months. and with new immunotherapy drugs (vaccines?) on the horizon that add multiple years

Anonymous said...

What ones on the horizon are you seeing?