Troubled online lender LendingClub has met with at least three large hedge funds to discuss deals in which they would commit to buying billions in loans and get the right to own shares, people familiar with the talks said.
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Och-Ziff Capital Management Group, Soros Fund Management, and Third Point are among the firms that have in recent weeks discussed with LendingClub proposals to fund as much as $5 billion in loans, though no deals have resulted, the people said.
A deal funding billions in loans would cover a considerable portion of LendingClub's annual volume, which was $8 billion last year.
Analysts say any deal of this sort would go a long way to restoring confidence in LendingClub's ability to match big buyers of loans with small borrowers. The so-called marketplace model propelled the startup to a huge valuation in its 2014 initial public offering, but it is under pressure following the forced resignation of LendingClub's chief executive and founder, Renaud Laplanche, last month.
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