Ranger Direct Lending Fund Cites Princeton Fund As Source of Woes

Ranger Direct Lending (Ranger), A UK-listed fund that has invested with companies such as AmeriMerchant/Capify, Biz2Credit, and Blue Bridge Financial, cited problems with the Princeton Alternative Income fund in its latest midterm report. The problems stem from Princeton’s original investment in Argon Credit, an online consumer lender that went bankrupt last December. The judge in the bankruptcy proceeding found that several of Argon’s asset valuation claims were unrealistic when Princeton attempted to secure its collateral. After a settlement, Princeton gained control of Argon’s loans and is servicing them. Meanwhile, Ranger sought to determine the damage that Argon had caused Princeton and was not satisfied with the answers it got, according to reports.

Princeton’s alleged lack of transparency caused Ranger to initiate arbitration proceedings against Princeton this past June. A hearing on the matter is scheduled to take place in November.

Ranger’s Net Asset Value grew by more than 4% in the first six months of the year, yet its share price has fallen to a substantial discount.

“The lack of clarity surrounding this [Argon Credit] impairment and the unwillingness of Princeton to supply detailed information to the Company or Deloitte, the Company’s auditors, led to the qualification of Ranger’s 2016 year-end audit opinion and only served to add to investor uncertainty,” a Ranger report says.

As of June 30, 2017, Ranger reportedly had more than $50 million invested in merchant cash advances and business loans, about 18% of its portfolio.