Hedge Funds

Silver Point Capital bails out Krispy Kreme

by

The hedge fund group Silver Point Capital is acting in concert with investment bank Credit Suisse First Boston to provide a bailout loan to prevent doughnut maker Krispy Kreme from defaulting on its existing debts.

The embattled Krispy Kreme is being probed by the U.S. Securities and Exchange Commission over its accounting practices and plans to repurchase existing franchises. The company recently saw lenders freeze a $150 million credit line after failing to release its earnings statement by the regulatory deadlines.

The loan from Greenwich, Conn.-based Silver Point and CSFB is aimed at keeping the company out of defaulting