Key Takeaways
- • Altana Wealth's Altana Distressed Opportunities Fund is targeting restructuring and consolidation opportunities in offshore oil and gas services, which the firm describes as a "forgotten" sector.
- • The strategy targets returns of around 3x over the next two-to-three years and has generated gains of more than 50 per cent year-to-date, according to the article.
- • Key positions include a first lien bondholding in Jacktel (owner of the Haven jack-up accommodation rig in the North Sea, trading in the high-teens), a restructuring play in Valaris, and Tidewater, the fund's largest overall position.
- • Altana, led by Lee Robinson, manages around USD700 million in assets under management across credit, event-driven, systematic and crypto strategies.
Summary
Altana Wealth, the London and Monaco-headquartered credit, currency and special situations hedge fund led by former Trafalgar Asset Managers co-founder Lee Robinson, is positioning its Altana Distressed Opportunities Fund around restructuring and consolidation opportunities in offshore oil and gas services. The thesis rests on a rebound in oil and gas demand following the Covid-19 pandemic, with an anticipated recovery in oil demand to pre-Covid levels set against a significant shortfall in supply, according to the firm.
Co-portfolio managers Steffen Dietel and George Yacoub Nadda said the post-pandemic industry reset would present opportunities "rarely seen" in their investment careers. Altana describes the sector as "over-levered but operationally essential," having passed through a debt-financed building boom, an "unprecedented" drop in capital expenditure after the 2014 oil price collapse, and a "timid" recovery. Dietel characterised the sector as a "super boom-and-bust cycle," further complicated by the pandemic, ESG pressures and the energy transition, which Altana says has led many investors to abandon the industry. Dietel also argued that a ramp-up in capital investment is necessary, which the firm identifies as a key tenet of its strategy.
The fund invests across equity and debt. The equities focus targets companies with "massively de-levered" balance sheets that can survive the downturn and drive consolidation. The credit component targets restructuring opportunities and special situations. Named positions include a first lien bondholding in Jacktel, owner of the Haven jack-up accommodation rig in the North Sea, where the bond trades in the high-teens; a restructuring position in drilling company Valaris; and Tidewater, described as the largest listed offshore vessel company, a key industry consolidator and the fund's biggest position.
The strategy targets returns of around 3x over the next two to three years. According to the article, the fund has generated gains of more than 50 per cent year-to-date. Altana, established in 2010, manages a range of niche alpha strategies spanning credit, event-driven, systematic and cryptocurrency approaches, with around USD700 million in AUM.
Co-portfolio managers Steffen Dietel and George Yacoub Nadda said the post-pandemic industry reset would present opportunities "rarely seen" in their investment careers. Altana describes the sector as "over-levered but operationally essential," having passed through a debt-financed building boom, an "unprecedented" drop in capital expenditure after the 2014 oil price collapse, and a "timid" recovery. Dietel characterised the sector as a "super boom-and-bust cycle," further complicated by the pandemic, ESG pressures and the energy transition, which Altana says has led many investors to abandon the industry. Dietel also argued that a ramp-up in capital investment is necessary, which the firm identifies as a key tenet of its strategy.
The fund invests across equity and debt. The equities focus targets companies with "massively de-levered" balance sheets that can survive the downturn and drive consolidation. The credit component targets restructuring opportunities and special situations. Named positions include a first lien bondholding in Jacktel, owner of the Haven jack-up accommodation rig in the North Sea, where the bond trades in the high-teens; a restructuring position in drilling company Valaris; and Tidewater, described as the largest listed offshore vessel company, a key industry consolidator and the fund's biggest position.
The strategy targets returns of around 3x over the next two to three years. According to the article, the fund has generated gains of more than 50 per cent year-to-date. Altana, established in 2010, manages a range of niche alpha strategies spanning credit, event-driven, systematic and cryptocurrency approaches, with around USD700 million in AUM.
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