Fortress fund tumbling down
The Macquarie Fortress Investments fund is close to collapse with the value of its portfolio falling by a third in the last week. The drop triggered a “margin call” with its asset backing falling to 35 cents per note, forcing the fund to sell more of the loans that make up its core portfolio. The latest sale has resulted in a $US25.5 million loss, but even that option may not be available in the future. The director of Fortress, Peter Lucas, has said that in the current market conditions selling the remaining portfolio would be unlikely to achieve its market value and that a they probably would not be able to find a buyer for a significant portion. Notes that were originally issued at $1 closed at 11 cents yesterday.
Source: The Australian Financial Review