2008-12-05 Schultze & Braun

Comments on the outlook for investment in distressed debt in 2009

The investment landscape of 2009 will be more treacherous than that of 2008 predicts Schultze & Braun, Germany’s leading insolvency and restructuring law firm. While the whole market now seems to fall under the ‘distressed investment’ category, Dr. Annerose Tashiro, Head of Cross-Border Insolvency and Restructuring, cautions on the year ahead:

“The really big change we have seen at the moment is the credit crunch limiting the reorganisation options of companies.  The lack of finance means there are very limited options for refinancing compared to the past, while the speed of the onset of the problems means that companies now have days or weeks to find a way to survive whereas previously they often had months.

“Investment bargains seem to abound now as some investors are forced to exit positions. The underlying message remains the same: in a cautious market, make sure you know your investment inside-out before acquiring as it may not be possible to unload easily and quickly. Moreover, we strongly believe things will get worse before they get better so leveraged positions, even if you can get them, are to be avoided.

“If there is the chance to fail for investment target, PE funds etc. should start as early as possible to consider all alternatives and always have and be prepared for Plan B.

“This is particularly true in the automotive and retail industries.  Shares may well be cheap now, but many have not undertaken the necessary investment to remain attractive prospects if the trend of eco-friendly transport continues to rise. This could suppress any rebound in value when the crisis subsides, while some may well become even more distressed in 2009 than they already are.”

For further information please contact our spokesperson:
Mail: Presse@schubra.de, Phone: +49 (0) 7841/708-0

Additional information:
  • 2016-07-13 Dr Stefan Schmittmann to assist Schultze & Braun as of counsel
  • 2012-10-10 New statistic from Schultze & Braun: Insolvency plan under-used
  • 2009-02-23 Appointment of Frank Tschentscher
  • 2008-12-19 Germany’s crunch to hit even harder in 2009 warn top insolvency lawyers
  • 2008-10-23 Warning for hedge funds with investments in Germany
  • 2008-07-25 Schultze & Braun wins landmark case against the Ordre des Avocats de Strasbourg
  • 2008-07-02 Law hits distressed debt investors
  • 2008-04-12 German credit crunch warning
  • 2008-03-03 German ministers seek to inflict pesticide on financial “locusts”
  • 2007-09-28 Leading german insolvency law firm launches in London
  • 2006-09-21 First book on restructuring with the insolvency plan under German law
  • 2005-03-21 New head of Schultze & Braun’s international team
Schultze & Braun LLP
http://www.schubra.de, Email: mail@schubra.de