Hedge funds split on outlook for junk bonds

Split on junk

High yield appears rich by most measures

Last April, Cengage Learning, an educational publisher owned by Apax Partners, sold $725 million of senior secured notes at par with an 11.5% coupon.

The company, which took on more than $5 billion in debt when it was acquired in 2007, saw revenues plunge 18% in the second half of the year. Bondholders got clobbered and Cengage is now in discussions with restructuring advisers.

Peter Troob, founder of credit hedge fund Troob Capital Management, expects more stories of corporate distress in the

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