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Earnings, Invitae Corporation files BK, A $TCS Update + More

Last Sunday’s a$$-kicking briefing painted a depressing picture of in-court restructuring activity. We noted how January ‘24 was the third-worst start to a year for chapter bankruptcy filings since 2010 (‘22 and ‘14 being worse). To add salt to the wounds, we indicated how the amount of high yield bonds and leveraged loans pricing at distressed levels are depressed, both down nearly 40% from January 1, 2024! When time came to point fingers, we, with support from J.P. Morgan and a few lawyers, directed our blame towards “liability management,” everybody’s issue du jour.

Now, in the mere seven days that have passed, the fine folks over at Latham & Watkins LLP and Kirkland & Ellis LLP took it upon themselves to make our grumbles look silly, filing, in the case of the former, RobertShaw US Holding Corp (an LM gone horribly wrong - coverage on this to come soon), and in the latter, both Invitae Inc. ($NVTA)(see below) and Sientra Inc. ($SIEN). But, frankly, that last one cuts both ways. Sure, it’s an in-court situation but why exactly is K&E even taking on a sub-$100mm debt case? Is it just the desire for world domination (of market share) or is that mandate a broader market commentary about dearth of deal flow (and a need to keep people busy)? Maybe … both?

But let’s not waste any more time on what we think or what subliminal messages might be out there. Let’s hear from those on the front lines: the investment bankers. With a month and a half of ‘24 behind us, what do they expect out of the rest of the year? Well, luckily, we just saw a whole wave of earnings and there are readily available answers. Let’s dig in ⬇️.