Key Takeaways
- • Arini's flagship hedge fund is down more than 26% year to date, according to a Financial Times report, even as the firm continues to raise capital.
- • The $22bn credit manager, founded by former Credit Suisse trader Hamza Lemssouguer, is facing margin calls from banks on its roughly $7bn flagship fund, forcing asset sales reportedly exceeding $2bn in face value over the past week.
- • Arini holds approximately $2bn of debt issued by Apollo-backed Brightspeed, which is reportedly considering a Chapter 11 filing.
- • Arini secured $1.5bn in new investor commitments in October, including $425m deployed at the start of the month, and remains open to further fundraising.
Summary
Arini is facing losses exceeding 26% this year at its flagship hedge fund, despite the credit manager continuing to raise fresh capital, according to the Financial Times. The $22bn investment firm, founded by former Credit Suisse trader Hamza Lemssouguer, has been hit by a sharp selloff in distressed corporate debt, with concentrated positions in heavily indebted companies amplifying losses.
The flagship fund, which manages approximately $7bn, has faced margin calls from banks providing leverage. Those calls prompted asset sales reportedly exceeding $2bn in face value over the past week. Arini has reduced positions in several corporate borrowers, including Merlin Entertainments, Claritev and Sabre, alongside more complex credit default swap exposures. Some rival hedge funds have reportedly established short positions against Arini's largest holdings, adding pressure on securities already affected by deteriorating credit conditions.
The firm's exposure to distressed borrowers presents further challenges. Arini holds approximately $2bn in debt issued by Apollo-backed telecoms operator Brightspeed, which is reportedly considering a potential Chapter 11 bankruptcy filing. The fund also holds sizeable positions in Altice International, Aston Martin and The Very Group, where restructuring negotiations and trading restrictions could complicate efforts to reduce exposure.
Arini's flagship strategy gained approximately 27% in 2023, 21% in 2024 and 10% in 2025, according to the report. The same concentrated credit approach has, however, left the fund vulnerable to illiquidity and forced selling during the current downturn.
Despite the losses, Arini secured $1.5bn in new investor commitments in October, including $425m deployed at the beginning of the month, and remains open to further fundraising. The firm maintains relationships with major Middle Eastern sovereign wealth funds, which could provide additional capital as it navigates the credit market dislocation. The episode underscores the risks of leveraged, concentrated distressed debt strategies when liquidity deteriorates and restructuring uncertainty forces managers to unwind positions at depressed valuations.
The flagship fund, which manages approximately $7bn, has faced margin calls from banks providing leverage. Those calls prompted asset sales reportedly exceeding $2bn in face value over the past week. Arini has reduced positions in several corporate borrowers, including Merlin Entertainments, Claritev and Sabre, alongside more complex credit default swap exposures. Some rival hedge funds have reportedly established short positions against Arini's largest holdings, adding pressure on securities already affected by deteriorating credit conditions.
The firm's exposure to distressed borrowers presents further challenges. Arini holds approximately $2bn in debt issued by Apollo-backed telecoms operator Brightspeed, which is reportedly considering a potential Chapter 11 bankruptcy filing. The fund also holds sizeable positions in Altice International, Aston Martin and The Very Group, where restructuring negotiations and trading restrictions could complicate efforts to reduce exposure.
Arini's flagship strategy gained approximately 27% in 2023, 21% in 2024 and 10% in 2025, according to the report. The same concentrated credit approach has, however, left the fund vulnerable to illiquidity and forced selling during the current downturn.
Despite the losses, Arini secured $1.5bn in new investor commitments in October, including $425m deployed at the beginning of the month, and remains open to further fundraising. The firm maintains relationships with major Middle Eastern sovereign wealth funds, which could provide additional capital as it navigates the credit market dislocation. The episode underscores the risks of leveraged, concentrated distressed debt strategies when liquidity deteriorates and restructuring uncertainty forces managers to unwind positions at depressed valuations.
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