Money managers under the microscope
Hedge Hub readers shouldn’t have been too surprised by yesterday’s 15 percent slump in Yell’s share price.
The directories firm — the one behind the UK’s Yellow Pages — faces months of talks with banks and shareholders after yesterday saying it plans to restructure its roughly 4 billion-pound debt burden for the second time in nine months.
Yell has had to battle a slump in classified advertising spending and a shift to online from print publications, and analysts have been predicting it could breach its covenants as soon as the start of next year.
Our blog on June 23, citing research from Dataexplorers, showed that Yell Group is among the top ten non-financial firms with the biggest net debt to equity ratios out of the 300 largest listed companies in the UK.
Hedge funds and other investors are shorting stocks laden with the biggest debts, according to stock lending research group DataExplorers, betting they may struggle to refinance themselves.