Blackstone-Hovnanian CDS deal revives credit rules debate

Rumoured triggering-for-financing arrangement sparks calls for more legal protection for sellers

Deals news
Claims of a possible deal to engineer a credit event have reignited a debate over credit definitions

A rumoured hedge fund proposal incentivising a US corporate to purposefully engineer a credit event has sparked fresh debate about the rules that govern credit derivatives.

Bloomberg reported last month that some market participants believe Blackstone Group’s GSO Capital Partners has offered cheap financing to New Jersey-based homebuilder Hovnanian in exchange for the company triggering a credit event.

One European asset manager that specialises in credit default swaps (CDSs) says the mere

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