Diala is a Partner at Paul Hastings. She advises on a wide range of fund-related work including private equity, private debt, real estate, mezzanine, venture, credit, infrastructure, funds of funds, distressed and special situations, and activist funds, as well as on the structuring of carried interest, co-investment and other incentive schemes, secondary transactions, and fund restructurings. Diala also specializes in direct lending funds, having set up the first regulated direct lending fund in Luxembourg in 2009 for ICG.
We are anticipating a lot of restructuring and debt-for-equity swaps coming through...Funds need to be sure they can hold the line there. A lot of debt funds aren't allowed to hold equity, but you could now have scenarios where debt funds are mostly equity, depending on how loans perform. Investors are keeping a close eye on that because they don;t want these funds turning into distressed funds. Documentation at the fund level is being drafted or amended with this in mind.