Hedge Funds

Juan Paulson No Longer Key To Puerto Rico’s Financial Survival

Sure, it’s happy that he likes the place and keeps throwing money at it. But it turns out that JP’s not the only hedge fund manager with a taste for the tropical island.

Prices on the U.S. territory’s bonds surged as much as 7.5% in heavy trading Wednesday, a day after hedge funds, mutual funds and other investors scrambled to get a piece of a $3.5 billion debt sale, Puerto Rico’s largest ever.

Buyers were enticed by generous potential returns—the bonds were priced to yield 8.73%, an unusually high level for a tax-exempt issue—and by the knowledge that other investors were lining up to get in on the deal. Barclays PLC, the bank leading the debt sale, tapped its larger corporate-bond salesforce to help pitch the Puerto Rico bonds to investors beyond just those traditionally interested in municipal debt. The banks involved received more than $16 billion in orders, and fund managers who got half the bonds they requested counted themselves lucky. Others received as little as 10% of what they had asked for.

Investors Flip for Puerto Rico’s Debt Offering [WSJ]
Major Investments Add Momentum to Puerto Rico’s Economic Resurgence [PR Newswire]

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2 Responses to “Juan Paulson No Longer Key To Puerto Rico’s Financial Survival”

  1. STDs says:

    If all you take back from PR is a 8.73% clip, consider yourself lucky…

  2. Quant me maybe ... says:

    Puerto Rico is like Bridgeport with palm trees.