Investing in distressed

January 2010
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Investing in distressed

At a glance

PwC whitepaper outlining how investors can seize distressed-company opportunities, including purchasing debts of distressed companies, providing financing to companies that lack bank options, utilizing a "loan-to-own" strategy, and buying assets via a section 363 process.

Even as the economy stabilizes, opportunities remain. What should private equity firms know about this attractive market?

While the number of distressed businesses stays at or near record levels, investing in distressed will become an increasingly attractive option as the deal market stabilizes.

Private equity buyers have an advantage over corporate buyers in a distressed environment; it is usually more difficult for public companies to purchase distressed assets or companies because of investment constraints. This is particularly true given the funding, liquidity, and financial reporting challenges associated with distressed companies.