Sector developments and company hires

Anti-NSDA provisions welcomed
The inclusion of anti-net short debt activism (NSDA) provisions in offering documentation has become more common in recent months, with Sirius Computer Solutions, Nexstar Broadcasting and Allied Universal Holdco deals incorporating such language. The purpose is to prevent net-short participants - whose interests are not aligned with those of other investors - from using their debtholder rights against the borrower to, for example, manufacture defaults. Anti-NSDA provisions include: requiring investors to disclose their net short positions for themselves and their affiliates either at the time of purchase or on an ongoing basis; disenfranchising net short investors by disregarding certain default actions taken by these investors; and causing net short noteholders to transfer their notes - with potentially punitive consequences - upon a misrepresentation or incorrect certification regarding their net short status. Moody’s notes that by reducing or eliminating NSDA-driven defaults, these provisions can be beneficial to CLOs, which haircut the value of all defaulted assets - thereby eliminating technical incentives that could influence managers to take actions contrary to their credit views and preserving value for all noteholders.

North America
Credit Suisse Asset Management has appointed Jason Bolding as md and head of ILS, US. He was previously an md at Aon Benfield Securities, which he joined in April 2005.