Exclusive: In the months before the collapse of auto-parts conglomerate First Brands, founder Patrick James was busy creating a new business group in Europe https://t.co/RkIvVoMDcf ...

Investment Strategy - Funds including Sona Asset Management, Apollo Global Management and Axebrook Capital are shorting the debt of Adler Pelzer Holding GmbH [1] - The shorting strategy is based on a bet that the auto-parts manufacturer will struggle to refinance its debt [1]

Group 1 - Jefferies Financial Group (NYSE:JEF) was upgraded to Outperform at Oppenheimer, with a price target set at $81.00 [2] - Shares of Jefferies Financial Group increased by 5.51% in pre-market trading to $51.49 [2] - The stock has been declining since the company disclosed its exposure to bankrupt auto-parts maker First Brands [2]

Core Points - First Brands Group is facing a significant financial crisis, admitting it cannot account for $2.3 billion related to off-balance sheet financing deals [1][2] - The US Trustee has filed for a quicker appointment of a bankruptcy examiner due to serious allegations of fraud and misconduct [2][3] - Raistone has requested an independent examination of the missing funds, criticizing the company's internal investigation as insufficient [3] - First Brands filed for Chapter 11 bankruptcy with over $10 billion in liabilities, prompting Wall Street firms to assess their exposure [4] Group 1 - First Brands Group has acknowledged a $2.3 billion discrepancy in its financial records related to off-balance sheet financing [1] - The US Trustee's court filings highlight serious allegations of fraud and mismanagement, justifying an expedited process for appointing a bankruptcy examiner [2] - Raistone's demand for an independent investigation emphasizes the potential scale of misconduct and the inadequacy of First Brands' internal review [3] Group 2 - The Chapter 11 bankruptcy filing of First Brands Group lists liabilities exceeding $10 billion, raising concerns among investors and creditors [4] - A fund managed by Jefferies Financial Group has approximately $715 million invested in receivables from First Brands' customers, indicating significant financial exposure [4]

Financial Irregularities - First Brands Group 承认无法找到与表外融资交易相关的 23 亿美元 [1] Regulatory Scrutiny - 公司破产的联邦监管机构加入了债权人要求对陷入困境的汽车零部件供应商 First Brands Group 进行独立调查的行列 [1]

Core Insights - First Brands, an auto-parts supplier, has filed for bankruptcy with $10 billion in debt, leading to the resignation of CEO Patrick James due to accounting irregularities [2][3] - Jefferies Financial has limited exposure to First Brands, estimated at approximately $45 million, which it claims can be easily absorbed without impacting its financial stability [4][7] Company Developments - Patrick James, the founder and sole equity owner of First Brands, resigned after the company faced scrutiny over its financial practices [3] - The company expanded rapidly by acquiring 25 automotive-parts suppliers, primarily using debt [2] Financial Implications - Jefferies Financial reported a significant exposure of about $715 million to First Brands through its Point Bonita Capital investment fund, but reassured investors that losses would be manageable [4][5] - First Brands had $2.3 billion owed to purchasers of receivables that were unpaid at the time of bankruptcy, indicating potential steep losses for lenders [6] Market Reactions - Jefferies Financial's stock fell 18% following the news of First Brands' bankruptcy, but the bank's leadership believes the market reaction was exaggerated and expect a correction as more information becomes available [4][8]

Financial Exposure - Norinchukin Bank 与日本贸易公司 Mitsui 的合资企业面临 17.5 亿美元的破产汽车零部件供应商 First Brands 的风险敞口 [1]

Financial Exposure - Western Alliance faces exposure to the collapse of auto-parts supplier First Brands [1] - The exposure is through a leveraged facility with a fund linked to Jefferies [1]

Exposure to Bankrupt Supplier - UBS funds face over $500 million exposure to bankrupt auto-parts supplier First Brands [1] Investment Strategies - Exposure is through various investment strategies [1]

Financial Distress - First Brands Group filed for bankruptcy in Texas [1] - Liabilities are estimated between $10 billion and $50 billion [1] Industry Implication - Auto-parts supplier faces significant financial challenges [1]