The perfect storm
At Globitas we are excited about the new year. We look forward to a very interesting 2020 with great investing opportunities.
Three key market and regulatory dynamics are combining to form a perfect storm for distressed investing. Ready to be unleashed when the current period of economic boom comes to its unavoidable end.
1. Rising levels of debt
Corporate debt levels are rising to an all-time high with a similar increase in likelihood that these debt positions cannot be serviced and become default.
2. Prudential backstop regulation
Under increasing regulatory scrutiny banks are looking for 3rd parties to take these non-performing loans off their balance sheets at a discount.
3. New restructuring mechanisms
The Dutch restructuring regulation WHOA offers the holder of these (senior) debt positions significant firepower to effectively restructure the company.
Follow our posts; the coming weeks we will be zooming-in the three key drivers that will unleash 'the perfect storm'.