Europe’s largest yacht builders, Bavaria, has knocked investment banks Goldman Sachs and Dresdner Kleinwort off an even keel after the companies backed a £1.1 billion buyout of the boatbuilder by Bain Capital last June.

A month after the deal closed the credit crunch took hold and the banks were forced to sit on 900 million Euros worth of Bain’s debt.

Now the bank has agreed to sell part fo the debt to hedge funds.