Cloud 9fin Scott Greenberg wants your cooperation
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Mar 5, 2025 
Scott Greenberg, global chair of Gibson Dunn’s restructuring group, dives deep into the world of liability management and cooperation agreements. He explains how cooperation agreements have evolved to become standard in U.S. deals and their growing presence in European markets. Greenberg highlights the shift of CLO managers from passive roles to proactive players in managing distressed assets. The conversation also touches on negotiating dynamics, antitrust considerations, and the necessity for collaboration among lenders to navigate the competitive financial landscape.
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CLO Managers: From Prey to Assertive Players
- CLO managers transitioned from being perceived as "prey" to assertive players in the market, exemplified by the Serta case.
- They now leverage their position and expertise, actively shaping outcomes rather than reacting defensively.
Rise of Cooperation Agreements
- Cooperation agreements have become increasingly common in liability management exercises (LMEs), reflecting lenders' desire for proactive negotiation.
- This shift aims to prevent being exploited in LMEs and promote a more unified approach among lenders.
Why Sponsors Dislike Co-ops
- Sponsors and companies dislike cooperation agreements because they reduce their negotiation leverage in LMEs.
- While not eliminating all options, co-ops limit sponsors' ability to exploit loopholes in loan documents, leading to more lender-favorable outcomes.