OCP Credit Strategy Fund

OCP Credit Strategy Fund

October 01, 2009 08:00 ET

Onex Credit Partners Announces Initial Public Offering of "OCP Credit Strategy Fund"

TORONTO, ONTARIO--(Marketwire - Oct. 1, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

All amounts in Canadian dollars unless otherwise stated

Onex Credit Partners, LLC ("OCP") announced today the filing of a preliminary prospectus for the OCP Credit Strategy Fund (the "Fund") with the securities regulatory authorities in each of the provinces of Canada. The Fund is offering trust units at a price of $10.00 per unit.

The Fund will be managed by OCP, the exclusive credit investing arm of Onex Corporation (TSX:OCX), a leading Canadian investment firm with a long established track record and a disciplined, value-oriented approach to investing. OCP believes that the dislocation in credit markets over the last two years has created an attractive environment for senior credit investors. Furthermore, OCP believes that investment opportunities in the North American senior debt market will continue to be favourable for investors for several years.

OCP will seek to generate attractive risk adjusted returns for the Fund through exposure to an actively managed, unlevered diversified portfolio (the "Portfolio") comprised primarily of senior debt obligations of non-investment grade North American issuers. In order to manage risk and volatility, the strategy is based on a diversified portfolio with limited exposure to equity investments and no leverage.

OCP will generally select investments for the Portfolio that meet the following criteria: (i) high levels of asset and/or cash flow coverage; (ii) attractive total return potential through a combination of current income and capital appreciation; and (iii) an anticipated company-specific event that OCP believes will trigger price appreciation.

Since its inception in 2001, OCP's Debt Opportunity Strategy, which employs the same strategy as the Portfolio, has outperformed all relevant benchmarks, including the S&P 500 Total Return Index, which it has outperformed by over 8.5% per annum, with generally less volatility and no leverage. Onex and Onex principals currently have approximately US$65 million invested in the Debt Opportunity Strategy.

OCP has a long track record of opportunistically investing in senior, non-investment grade debt. Operating from offices in Englewood Cliffs, New Jersey, OCP's 11-person team is led by Michael J. Gelblat and Stuart R. Kovensky, each of whom have more than twenty years' experience in the senior credit markets.

The Fund will seek to achieve the following objectives: (i) to maximize total returns for holders of Units ("Unitholders"); (ii) to provide Unitholders with attractive, quarterly, tax-advantaged distributions, initially targeted to be $0.70 per annum, representing an annual yield of 7% based on the original issue price of $10.00 per Unit; and (iii) to preserve capital. It is expected that quarterly distributions received by Unitholders will consist primarily of returns of capital for tax purposes.

The syndicate of agents for the offering is co-led by RBC Capital Markets and CIBC, and includes BMO Capital Markets, Scotia Capital Inc., Dundee Securities Corporation, GMP Securities L.P., Canaccord Adams, HSBC Securities (Canada) Inc., Blackmont Capital Inc., Desjardins Securities Inc., Manulife Securities Incorporated, Raymond James Ltd., Research Capital Corporation and Wellington West Capital Markets Inc.

Certain statements included in this news release constitute forward-looking statements, including, but not limited to, those identified by the expressions "expect", "intend", "will" and similar expressions to the extent they relate to the Fund. The forward-looking statements are not historical facts but reflect Onex Credit Partners, LLC's current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Although Onex Credit Partners, LLC believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. Onex Credit Partners, LLC undertakes no obligation to update publicly or otherwise revise any forward-looking statement or information whether as a result of new information, future events or other such factors which affect this information, except as required by law.

A preliminary prospectus dated September 29, 2009 containing important information relating to these securities has been filed with securities commissions or similar authorities in all of the provinces of Canada. The preliminary prospectus is still subject to completion or amendment. Copies of the preliminary prospectus may be obtained from any of the Agents. There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the preliminary prospectus has been issued. All capital terms used but not otherwise defined have the meanings assigned to such terms in the preliminary prospectus.

Contact Information

  • Onex Credit Partners
    Stuart Kovensky
    Co-Chief Investment Officer
    201.541.2121
    or
    Onex Corporation
    Andrew Sheiner
    Managing Director
    416.362.7711