Cerberus Capital Management has grown its team of former bankers and container shipping experts following its acquisition of billions of dollars of distressed German shipping debt.
Former HSH Nordbank executives Peter Sikkel and Rudiger Volke have hooked up with the New York-based private equity firm, according to German financial sources.
Cerberus has also poached Niclas Ahrens from Peter Dohle, where he was managing director of its Blue Net Chartering containership joint venture with Greek owner Costamare.
Cerberus’ role in Hamburg has been growing since it became a lead investor along with JC Flowers and others in HSH Nordbank, which has $4.2bn in nominal shipping loans
That is where Volke held a senior position as head of restructuring, and Sikkel was in charge of non-performing loans (NPL), distressed debt and special situations.
It is understood the appointments are for consultancy and advisory roles. Cerberus does not have an office in the Germany city and has no plans to open one, although Hamburg sources said some of its meetings have taken place in the offices of Peter Dohle.
Cerberus is emerging with a penchant for recruiting former German bankers. The move follows the acquisition of more than $6bn-worth of nominal shipping loans from distressed German banks.
Early this month, it acquired the 263-vessel portfolio, denominated Big Ben, that was being offloaded from Nord/LB for more than €2.6bn ($2.9bn).
That book is to be serviced from London by debt manager Mount Street, whose shipping desk is run by former Nord/LB banker Aaron Sen. Mount Street has this month opened an office in Hamburg.
Sources familiar with Cerberus said that its London-based affiliate, run by Aaron Maczonis and Allen Ukritnukum, wants to scale down the loan portfolio within the next 18 months.
Cerberus doesn’t want this loan portfolio. They bought it to be immediately redeemed by other banks
“Cerberus doesn’t want this loan portfolio. They bought it to be immediately redeemed by other banks,” said one German financier.
The secretive private equity player is making no comment on its plans, but sources in New York familiar with Cerberus said the firm was in no rush to offload its recently acquired shipping loan portfolios.
Cerberus has acquired distressed shipping debt portfolios cheaply.
Two German sources said it paid 41 cents on the dollar to acquire the Big Ben portfolio, which has a nominal value of $2.7bn.
Separately, the Financial Times reported that Cerberus rolled up the lion's share of toxic shipping loans from HSH Nordbank with a face value of €6.3bn at a 62% discount.
The low purchase price gives Cerberus a good chance of making a healthy return on its investment by selling the loans quickly, financial sources believe.
The development comes as Cerberus continues to make its mark at Hamburg Commercial Bank — as HSH Nordbank has been rebranded — with the appointment of two board members.
Senior Cerberus executive Ian Banwell has been made chief operating officer, while his Cerberus colleague Christopher Brody has been appointed chief investment officer.