DDJ Capital Management introduces a new dedicated senior loan strategy

By Tali David

Minneapolis, April 24 - DDJ Capital Management, LLC has introduced a dedicated senior loan strategy, seeded with about $100 million from an existing European-based subadvised client, according to a press release.

The investment objective of the strategy is to provide investors with high current income primarily achieved through floating-rate instruments with an emphasis on principal protection.

Compared with DDJ's flagship U.S. opportunistic high-yield strategy, the new senior loan strategy employs a more conservative approach by investing predominantly in secured term loans senior in the capital structure of non-investment-grade issuers across a wide range of industries, primarily in the United States and Canada, the release said.

"In an environment in which interest rates could be rising, bank debt is an attractive asset class relative to bonds because of its shorter duration, floating-rate coupon and senior secured status in a corporate capital structure," executive vice president and portfolio manager Tony Ranaldi said in the release.

"We believe that our strategy is appropriate for clients seeking higher-yielding debt with lower interest-rate risk than the broader high-yield market."

DDJ Capital is a Waltham, Mass.-based high-yield and special situations investment manager.

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