Distressed Debt Investing

AVAILABLE 26th MARCH 2012

The first report where pension scheme managers and trustees analyse alongside their distressed debt fund manager peers the opportunities emerging from the fall out of continuing Euro-zone economic troubles and forthcoming banking regulation for capital reserves on the distressed debt sector.

With the Euro-zone continuing to battle budget deficits and an uncertain economic environment, European corporations are facing a particularly tough short to midterm trading environment. Coupled with the economic uncertainty, investment banks are carefully assessing their corporate loan holdings with a need to reduce their capital at risk prior to new regulation in October 2012. As a result, opportunities are emerging for distressed debt fund managers to step in and offer the required capital to structurally good companies whilst serving the interests of European and U.S. pension plans seeking routes through which to diversify their private equity and alternatives portfolios.

Distressed Debt Investing is the first annual report, led by 15 of Europe’s most well-known pension scheme fund managers and private wealth groups and joined by a select number of distressed debt fund managers. The report will examine key issues surrounding setting a distressed debt investment strategy and overcoming the challenges facing distressed debt fund managers, both new to Europe and existing, in operating in such a unique economic and market environment.

Key Issues the report will focus on include:

What is the outlook for Euro-zone economy, sovereign and corporate distressed debt?
Will a ‘Great De-leveraging’ of banks create a ‘once in a lifetime’ buying opportunity or just pass failed companies down the line?
The Current state of the secondary debt/high yield marketplace and resulting impact on the distressed debt sector
Are we likely to see a prolonged recession resulting in long-term low valuations and a difficult growth environment for businesses?
The outlook for the Euro-zone and hence opportunities

Factors effecting investors the report will focus on include:

Is this the right time to enter the distressed debt market, or will valuations go down?
Understanding distressed debt as an asset class and how managers make profit?
How distressed or depressed should investors consider going – opportunities in the insolvency market?
What are the reputational risks when investing in distressed debt or perceived “vulture funds”?
The Impact on European distressed debt pricing with an influx of U.S. managers
Understanding and assessing the different profiles of distressed debt – corporate equity, corporate loans, sovereign and real estate