Corre’s underwriting process provides for tactical investing in either credit or equity, enabling us to initiate an investment position that optimizes the risk/reward specific to each situation. As a turnaround accelerates and drives material operational and balance sheet improvement, Corre can also leverage its ability to shift across the capital structure by investing in equities either outright or through restructured debt to fully capitalize on the upside value unlocked from these positive changes and ultimate market readoption.
We avoid businesses that are in secular decline, hopeful miracles or consistent money losers. Most turnarounds do not succeed, so our burden in the investment selection process is proving not only why each investment will work but also why it is the right opportunity with an appropriate risk/return skew.
We aim to know our companies better than anyone else and approach our diligence as if we own them outright regardless of the targeted security. This ownership mindset drives our research deeper and away from a short-term outlook while often leading to active and constructive engagement with our companies that maximizes our return outcomes.
We de-risk our investment at the outset through detailed turnaround scenario planning and continually asking the question, “What can go wrong?” Targeted security selection, board representation where appropriate, active engagement with management and other key stakeholders and a dedicated short book focused on hedging higher beta investments additionally help mitigate risk.
We have a proven advantage in providing tailored financing solutions to companies in need on an expedited basis.
Our portfolios do not resemble our peers’ portfolios given our focus on under-followed middle-market companies and how we implement our strategy.
Our team sources new investments from across a wide range of sectors with a focus largely on North American headquartered businesses. Our target companies are either in turnaround or experiencing a temporal dislocation that has led to their securities pricing at deep discounts to intrinsic value.
We concentrate on under-followed situations where we can gain an edge and do not shy away from complexity, capitalizing on shrinking credit and equity research in this area. Our diligence process aims to find companies to invest in where we can identify and help to implement “fixes” that will unlock value over time.