Distressed Investors See Silver Lining Ahead

NEW YORK CITY-”The market is in a pickle right now and it will get much worse from here, whether we go into a recession or not,” said Bruce Richards, president & CEO of Marathon Asset Management LLC. Richards, who oversees the global alternative investment and asset company with more than $10 billion in capital under management, was the opening keynote speaker at Argyle Executive Forum’s 2008 Leadership in the Distressed Markets event.

Wray Thorn, managing director of private equity at Marathon, moderated the “fireside chat” session titled, “Distressed: The Brave New World,” Thursday morning. Richards explained to 135 or so attendees that the market will not be a pleasant time right now for most, but for distressed players, it is a good time.

Richards compared the current cycle to the early 1990s more so that the 2002 cycle for example. He noted that if you tried to characterize the types of companies that were distressed in 2002, they were the “Enron’s of the world,” adding that it was more about “fraud and bad business models in general.” Richards said that “this time around, you will see more good companies with bad balance sheets and bad companies with bad balance sheets, akin to the ’90s era.”