Former star traders launch new distressed debt firm
The former heads of European distressed debt trading at Deutsche Bank and proprietary trading at Morgan Stanley have returned to the markets to launch a new independent distressed debt-focused broker, the latest of a band of boutiques established this year.
Simon Mullaly and Lars Lemonius, who left Deutsche Bank and Morgan Stanley in London more than a year ago, co-founded Yorvik Partners earlier this year, but launched the European debt brokerage business this week in an effort to take advantage of the “unprecedented scale of distress” and a “lack of credible dealing alternatives”.
The credit crisis has forced widespread dislocations in the value of debt securities and bank loans, creating lucrative investment and trading opportunities for those that have experience of dealing in bonds and loans that trade at severely depressed pricing levels.
A slew of former credit traders at big investment banks have returned to the markets this year to set up independent, structuring, trading and advisory firms, some even former colleagues of Mullaly and Lemonius at Deutsche Bank and Morgan Stanley. In a statement, Mullaly said: “Yorvik will not be seeking to mirror what the larger broker dealers provide but instead offer a research intensive and transparent dealing service that will be driven by customer needs rather the dealer’s balance sheet.”
He added: “Our main focus will be less liquid debt and event driven credit situations in particular in the distressed debt market. By differentiating our dealing with bespoke research as opposed to capital, we believe, we will remove a fundamental conflict that currently exists between most clients and broker dealers.”
The firm, which deals across securities, bank debt and trade claims, which are claims held by suppliers owed for goods or services they have provided, has nine staff in total.
Sales are being run by Laurent Jastrow, formerly of Deutsche Bank, Lorraine McGarry, formerly of Bear Stearns and JP Morgan, and Sharon Knaggs, formerly of Bank of America Merrill Lynch.
Research is being run by Alexander Paulick, formerly of Elliott Advisors, and Nina Selden, formerly of Royal Bank of Scotland.
Head of operations is Lisa King, who joined from Morgan Stanley. The ninth member of staff is the office assistant.
Both Mullaly and Lemonious are two of the most well-known figures in the European distressed debt arena.
Mullaly was formerly managing director and head of trading within the Deutsche Bank’s distressed product group. Before that he was head of high-yield and distressed trading at Lehman Brothers in London. Mullaly has also worked at Goldman Sachs.
Lemonius was most recently a managing director in the Morgan Stanley’s institutional securities division and head of its European principal strategies investment group, which invested the broker’s own money. Lemonius worked at Morgan Stanley for 16 years.
The name Yorvik Partners is derived from the name the Vikings gave to the city of York, in Northern England. Mullaly is originally from York, while Lemonius is from Denmark.
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