Goldman Strikes Unusual Concession in Struggling $2 Billion Deal

With markets souring in October, Goldman Sachs Group Inc. found an unusual ally to help with a struggling buyout loan: hedge funds that had been betting against the target company.

The investment bank was lead underwriter for debt that financed United Natural Foods Inc.’s acquisition of grocery chain Supervalu, and as markets made investors increasingly skittish, Goldman faced potential losses if it struggled to place the debt. As bankers often do in such situations, they sweetened the pot.

But within the flurry of changes to the loan was one particular tweak that helped win over a select group: hedge funds ...