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Jonathan Binder From Komfie Manalo, Opalesque Asia:

The Consilium Global Credit Strategy, a fund managed by Florida-based Consilium Investment Management did not anticipate Libya would be engulfed in political turmoil when it shorted Egyptian government bonds in January. As it turns out the decision was correct as shorting Egyptian government bonds provided the most significant contribution to the fund’s 1.05% returns in January.

Ironically, Consilium’s long position in the Turkish government bonds proved to be a miscalculation as it became the biggest detractor to performance. The fund’s Egypt and Turkey positions were a pair trade, with Egypt anticipated to underperform Turkey. But the turn of events in Egypt reversed the performance outcome.

In January, Consilium entered into a new position with Jack Cooper Holdings, the second largest operator of new and used car transportation in the US. Jack Cooper survived the downturn in car sales when annual sales fell from 16 million in 2007 to below 10 million in 2009.

As good times start to take hold, Jack Cooper is expecting new car sales to increase further and anticipates to sell more than 12 million units this year.

Jonathan Binder, Consilium’s Chief Investment Officer says “The private company has leverage of 3.3x and competitors trade at an average enterprise value of 7.2x EBITDA. This implies significant equity value for the company and asset coverage for the bonds......................

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