Key Takeaways
- • Arini Capital Management's master fund lost 19.7% in October 2026, pushing its year-to-date decline to 32%, according to an investor letter reported by Bloomberg.
- • The fund, run by founder Hamza Lemssouguer, has heavy exposure to CCC-rated corporate debt, and the letter acknowledged the firm underestimated the disruption in that segment.
- • Arini re-underwrote its five largest positions (about two-thirds of net asset value), trimmed holdings, and cut gross leverage to its lowest level since early 2022.
- • The fund took in $389 million of inflows over the past week as part of a broader $1.5 billion capital raise.
- • Pacific Investment Management Co. and Oaktree Capital Management are cited as prospective buyers of some holdings, with initial sales focused on more liquid, better-performing assets.
Summary
Losses at Arini Capital Management's master fund deepened in the final days of October, leaving the London-based credit specialist down 32% for 2026 after a 19.7% decline in October alone, according to an investor letter reported by Bloomberg. Investing.com, citing Bloomberg, reported that the year-to-date loss had stood at roughly 26% as of October 23.
The fund, run by founder Hamza Lemssouguer, has heavy exposure to CCC-rated corporate debt, one of the riskiest segments of the credit market. The letter acknowledged that the firm underestimated the extent of the disruption in that part of the market. Arini attributed the weakness partly to technical pressures, including limits on how much CCC-rated paper collateralized loan obligations can buy, and to what it described as aggressive short selling. Holdings cited in the reports include debt of Altice International, Brightspeed and Aston Martin.
In response, Arini re-underwrote each of its five largest positions, which together represent about two-thirds of net asset value, and trimmed selected holdings. The firm reduced gross leverage to its lowest level since early 2022 and signaled plans to diversify the portfolio. Some holdings have been offered for sale, with prospective buyers including Pacific Investment Management Co. and Oaktree Capital Management, according to the reports. Initial transactions focused mainly on more liquid, better-performing assets.
The fund is also still raising capital. Arini took in $389 million of inflows over the past week as part of a broader $1.5 billion capital raise, according to the letter. Arini declined to comment to Business Insider.
The combination of a deep drawdown, deleveraging and fresh subscriptions presents a clear test for allocators. The key question is whether new money is being committed at distressed entry points in a concentrated, contrarian book, or whether further forced selling in CCC credit pushes marks lower before catalysts arrive.
The fund, run by founder Hamza Lemssouguer, has heavy exposure to CCC-rated corporate debt, one of the riskiest segments of the credit market. The letter acknowledged that the firm underestimated the extent of the disruption in that part of the market. Arini attributed the weakness partly to technical pressures, including limits on how much CCC-rated paper collateralized loan obligations can buy, and to what it described as aggressive short selling. Holdings cited in the reports include debt of Altice International, Brightspeed and Aston Martin.
In response, Arini re-underwrote each of its five largest positions, which together represent about two-thirds of net asset value, and trimmed selected holdings. The firm reduced gross leverage to its lowest level since early 2022 and signaled plans to diversify the portfolio. Some holdings have been offered for sale, with prospective buyers including Pacific Investment Management Co. and Oaktree Capital Management, according to the reports. Initial transactions focused mainly on more liquid, better-performing assets.
The fund is also still raising capital. Arini took in $389 million of inflows over the past week as part of a broader $1.5 billion capital raise, according to the letter. Arini declined to comment to Business Insider.
The combination of a deep drawdown, deleveraging and fresh subscriptions presents a clear test for allocators. The key question is whether new money is being committed at distressed entry points in a concentrated, contrarian book, or whether further forced selling in CCC credit pushes marks lower before catalysts arrive.
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