Michael Gatto (Silver Point Capital) on what decides a lender's recovery: the credit agreement, not the default.

A lender can be right about the business and still lose money. Josef Pschorn speaks with Michael Gatto about the second question a credit committee tends to skip. Not whether a borrower defaults, but what value and control leave the structure when a structure cracks.

Shownotes and analysis: https://www.fixedandfloating.com/

Michael Gatto: Partner and Head of Private Side Businesses, Silver Point Capital.

LinkedIn: https://www.linkedin.com/in/michael-gatto-8a322b66/

Silver Point Capital: https://www.silverpointfinance.com

The Credit Investor's Handbook: https://www.amazon.com/Credit-Investors-Handbook-Leveraged-Distressed-ebook/dp/B0CR4MMD29?ref_=ast_author_mpbMichael's latest articles: https://www.silverpointcapital.com/uploads/2026/05/47c34854a238cfef86eb78e3800da100/what-questions-should-allocators-ask-when-evaluating-direct-lending-managers.pdfhttps://www.silverpointfinance.com/images/news/pdf/What%20Can%20We%20Learn%20From%20First%20Brands%20-%20SPC%20Credit%20Lessons.pdf
Connect with Fixed + Floating: https://www.linkedin.com/company/fixed-floating | https://twitter.com/FixedFloating |

Fixed + Floating is for informational purposes only. Not investment, legal, or tax advice.

Recorded: 10.09.2026

#fixedfloating #creditmarkets #privatecredit #liabilitymanagement #directlending

Ankur Patel⁠ (Ares Credit Group) on asset-based finance for data centres, power and GPUs.

A one-gigawatt data centre costs $15–20 billion to build. The GPUs and servers inside it can run $40 billion-plus, and they are the shortest-lived asset in the project. Josef Pschorn speaks with Ankur Patel about how that credit is structured so a lender is not relying on residual chip value to get repaid.

Shownotes and analyis: https://www.fixedandfloating.com/⁠

Ankur Patel: Partner, Ares Credit Group (Alternative Credit).

LinkedIn: https://www.linkedin.com/in/ankurjpatelcfa

Ares Management: https://www.aresmgmt.comConnect with Fixed + Floating: LinkedIn ⁠https://www.linkedin.com/company/fixed-floating⁠ | X ⁠https://twitter.com/FixedFloating⁠ Fixed + Floating is for informational purposes only. Not investment, legal, or tax advice.Recorded: 11.08.2026#fixedfloating #creditmarkets #assetbasedfinance #privatecredit #gpufinancing #datacenters #aiinfrastructure

An amend-and-extend moves the maturity and leaves the leverage where it was. A debt-for-equity swap cuts the debt and dilutes the equity. The first is routine and the second is rare, and the constraint is not legal - most of the holder base cannot take the equity or does not want it.

Josef Pschorn speaks with Mike Harmon of Stanford Graduate School of Business about why out-of-court restructurings extend maturities without reducing debt, and what has to be true before a company actually deleverages.

• Once a company is worth less than its debt, the equity is an out-of-the-money call option, so shareholders buy time and volatility rather than repair the balance sheet
• Without maintenance covenants, creditors cannot force a reduction in debt
• Most of the holder base does not want equity: CLOs have equity buckets, mutual funds have mandates, and only distressed funds want the position
• Creditors are not one actor - a lender hedged with CDS or a par lender who has not marked down has a different payoff from a discount buyer
• Private credit changed the composition of the holder base rather than the law, which is where debt-for-equity swaps are actually getting done
• The US has liability management at one end and Chapter 11 at the other with nothing in between, while the UK, Japan, France and China all run a lighter court-supervised path

Mike Harmon: Stanford Graduate School of Business. https://www.linkedin.com/in/mike-harmon-92b130184

The Financial Restructuring Tool Set (Columbia University Press): https://cup.columbia.edu/book/the-financial-restructuring-tool-set/9780231216982/

Liability Management’s Limited Runway: Corporate Restructuring Today, Mark J. Roe, Vasile Rotaru - Oxford Business Law Blog

Connect with Fixed + Floating: LinkedIn https://www.linkedin.com/company/fixed-floating | X https://twitter.com/FixedFloating

Fixed + Floating is for informational purposes only. Not investment, legal, or tax advice.

Recorded: 24.08.2026

#fixedfloating #creditanalysis #liabilitymanagement #distresseddebt #restructuring #privatecredit

A fifteen-billion-dollar manager's European analyst can look at three or four situations before the rest fail his liquidity screen. Frits Lieuw-Kie-Song runs a few hundred million and can look at hundreds. This is a full walk through how a long/short credit hedge fund is actually run.

Full analysis: https://open.substack.com/pub/fixedfloating/p/how-a-longshort-credit-hedge-fund?r=718tew&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true

Josef Pschorn speaks with Frits Lieuw-Kie-Song ofIronshield Capital about building a market-neutral high yield book: which credits are eligible, how positions get sized, when a short earns its borrow, and where the tail hedge sits.

• Liability management exercises now bring the mediancompany back within roughly a year, because the fee-driven process fixes the balance sheet without fixing the business.
• Being in the co-op group is not the same as sitting on the committee, and Frits will pass on a situation where he cannot influence how the pie is divided.
• A 400 million single-bond capital structure is too small to matter for a fifteen-billion manager, which is where in-depth research still earns its keep.
• Position size is dictated by the downside case, with a loss budget of roughly 50 basis points of the fund per position.
• The tail hedge is put spreads 5 to 15% out of the money, six months out, rolled regularly, written for the event where correlation goes to one.
• Two worked trades: Evoke after the UK online gamingtax move, bought at a 70 LTV with a takeover catalyst, and Volta Grid during the data centre construction scare.
  

Ironshield Capital: https://ironshieldcapital.com/
Connect with Fixed + Floating: LinkedInhttps://www.linkedin.com/company/fixed-floating | Xhttps://twitter.com/FixedFloating
Fixed + Floating is for informational purposes only.Not investment, legal, or tax advice.
Recorded: 27.07.2026
#fixedfloating #creditanalysis #highyield#longshortcredit #liabilitymanagement #europeancredit

Private credit has grown to roughly $2 trillion, but selling a single position remains a manual, bilateral process. Exiting a $25 million loan means NDAs, a data room, agent and borrower consents, and bespoke documentation — four to six weeks from decision to settlement, if a buyer is found at all.

Full analysis: [INSERT SUBSTACK LINK]

Josef Pschorn speaks with Alex Cordover, CEO of Tradable, about the exact mechanics of private credit secondaries — what happens between the decision to sell and settlement, and what a functioning secondary market requires.

• The full transfer anatomy: NDA, data room (loan tape, financials, original IC memo), non-binding IOI, consents, documentation, settlement
• Participation vs assignment: in a default, participation rights typically run against the seller, not the borrower
• Marks vs prices: every deal closed on Tradable has printed at par plus a buyer's premium, while valuation lag persists in software and direct-lending books
• Why trades die: information asymmetry and GPs unused to working together — not asset quality
• Where liquidity comes first: asset-backed, equipment and real estate finance before bespoke unitranche and distressed names

Guest links: https://tradable.xyz | https://www.linkedin.com/in/alex-cordover-72a0a276

Connect with Fixed + Floating: LinkedIn https://www.linkedin.com/company/fixed-floating | X https://twitter.com/FixedFloating

Fixed + Floating is for informational purposes only. Not investment, legal, or tax advice.

Recorded: 15.07.2026

#privatecredit #privatecreditsecondaries #creditmarkets #fixedincome #assetbackedfinance

MicroStrategy’s preferred shares dropped more than 20% over a few weeks. Then an 8-K reversed the mood, handingthe company buyback authority over both its preferred and common stock for the first time. The headlines focused on a small Bitcoin sale; the more important story was buried underneath it.

Full analysis: https://open.substack.com/pub/fixedfloating/p/stretch-is-not-cash-the-lesson-from?r=718tew&utm_campaign=post&utm_medium=web

Josef Pschorn speaks with Mark Palmer of Benchmark-StoneX, the first Wall Street analyst to cover Strategy, about how the company’s capital structure actually holds together and what genuinely changed.

Key takeaways:

• The 8-K gave Strategy “two-way capital management” for the first time — the ability to buy backpreferred and common stock, not just issue new securities to buy Bitcoin.
• Perpetual preferred stock behaves like near-permanent capital: no maturity wall, not dilutive while outstanding, and tax-advantaged as return of capital for as long as the company posts no positive net income.
• The recent Stretch selloff was driven by forced deleveraging among investors who had levered the position, not by any change in the Bitcoin backing the instrument.
• A common misconception — that a falling Stretch price increases Strategy’s cash dividend obligation — is simply wrong; the dollar obligation is fixed regardless ofprice.
• Strategy’s $6.75 billion convertible debt carries a blended coupon of just 0.52%, with the real risk being the 2028–2032 maturity wall rather thaninterest expense.

Guest links: https://www.benchmarkcompany.com/leaders/1601/

Connect with Fixed + Floating: LinkedInhttps://www.linkedin.com/company/fixed-floating | Xhttps://twitter.com/FixedFloating

Fixed + Floating is for informational purposes only. Not investment, legal, or tax advice.

Recorded: 01.07.2026

Each AI company can price itself on an internally consistent story about winning its market. Sum those stories and the implied revenues exceed any market that could exist — the big market delusion. Aswath Damodaran puts a ceiling on it: $142 trillion in global revenues last year against $20–25 trillion in employee costs, which makes the $26 trillion addressable market in SpaceX’s IPO pitch fiction. The sharper question for credit investors is who absorbs the loss when it corrects.

Full analysis: https://open.substack.com/pub/fixedfloating/p/financing-the-big-market-delusion?r=718tew&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true

Josef Pschorn speaks with Aswath Damodaran of NYU Stern about valuing the AI boom, the corporate life cycle, and why the credit side of the build-out carries the asymmetric risk.

Key takeaways:

• ​The biggest loser when the delusion corrects is private credit, not equity — lenders carry the downside without the upside, and “you can’t make interest payments withpotential and promise.”
• ​Financing should act its age: young companies should use converts or no debt; default risk belongs in the cash flows (value the firm twice, weight by survival probability), not in an inflated discount rate.
• ​In distress, equity is a call and debt is a put — a passive lender in a levered company is short an option whose variance the equity holder controls.

Connect with Aswath Damodaran: https://pages.stern.nyu.edu/~adamodar/ | X https://x.com/AswathDamodaran

Connect with Fixed + Floating: https://www.linkedin.com/company/fixed-floating | Xhttps://twitter.com/FixedFloating

Fixed + Floating is for informational purposes only. Not investment, legal, or tax advice.

Recorded: 15.06.2026#fixedfloating #creditmarkets #privatecredit #valuation #Damodaran

A third of Europe’s auto suppliers now sit in the distressed zone, and the share has barely moved in two years. Thesector has stopped behaving like a set of single restructuring cases and started behaving like a structural problem — one where operational stabilization no longer fixes the credit story.

Full written analysis: https://open.substack.com/pub/fixedfloating/p/the-autosupplier-problem-that-refinancing?r=718tew&utm_campaign=post&utm_medium=web

Josef Pschorn speaks with Daniel Steiner of PwC and Dr. Hendrik Hauke of Willkie Farr & Gallagher about whyEuropean auto-supplier distress has become structural, and how the restructuring toolkit actually gets used when it does.

Key takeaways:

• 40% of automotive CEOs expect their company not to last ten years on the current path; 33% of Europeansuppliers are already distressed.
• The binding constraint is the cost ofcapital — German suppliers carry the highest interest-to-EBIT ratio of anyregion.
• Europe runs 25–30% overcapacity and China around 50%, making consolidation, not refinancing, the real cure.
• LEONI’s StaRUG delevered successfully the balance sheet

Guest links: PwC https://www.pwc.de | Willkie https://www.willkie.com

Fixed + Floating:

⁠https://www.linkedin.com/company/fixed-floating⁠⁠ | ⁠⁠https://twitter.com/FixedFloating⁠⁠ | ⁠⁠https://fixedfloating.substack.com/⁠⁠

This podcast is for informational purposes only and does not constitute investment advice.

Recorded: 04 June 2026.

#fixedfloating #creditmarkets #autosuppliers #restructuring #distresseddebt