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Asia’s distressed assets worth up to US$50 billion

Date: 11 Feb 2010

Income Partners and Deutsche Bank estimate that there are US$40 billion to US$50 billion of potentially distressed assets in Asia and Australia, with many companies avoiding default only because of the low interest rate environment.

Keywords (click to search): [Income Partners] [Deutsche] [fund] [distressed debt] [China] [India] [Indonesia]

Richard Morrow

Around US$40 billion to US$50 billion of potentially distressed assets exist in Asia and Australia, but a generally low interest rate environment has prevented many troubled companies from falling into insolvency, according to Income Partners and Deutsche Bank.

Speaking with Asiamoney.com, Jiffriy Chandra, partner and CIO of credit at Income Partners, said that his asset management company is launching a new umbrella distressed asset and special situations fund because so many opportunities exist.

“After the crisis we saw a quick and sharp recovery in public space and the largest companies with private financing could finance their way out by doing an IPO. But there is a huge batch of companies still out there in effective standstill,” Chandra said. “They may be current on their coupons but cannot refinance [the debt principal] as the capital available for refinancing is still very selective.”

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