Acquiring Distressed Businesses in Ireland
Jon Moulton
• Ireland has lots of distressed companies. Fact.
• Irish Bank IPOs similar in frequency to distressed company acquisitions in Ireland. Also fact.
Total Insolvencies: Comparison from 2009 to 2011
Source: Insolvency Journal.(http://www.insolvencyjournal.ie/industrial_stats/11-09-01/Total_Insolvencies_Comparison_from_2009_to_2011.aspx)
Total Insolvencies by Industry: Comparison from 2009 to 2011
Source: Insolvency Journal. (http://www.insolvencyjournal.ie/industrial_stats.aspx?NewsCatID=7edd0572-1fa4-48df-bf06-9d64eedab7be)
Potential Targets• Good businesses, bad balance sheets
– debt for equity deals by banks• Silly legacy cost base – rents
- insolvency or law change • Poor operating result, lots of debt (usually)
- debt for equity- fresh equity- new management (mostly)(Our sort of deal)
• Poor businesses, bad balance sheets- liquidate and liberate people and assets
Owners• NAMA – National hotel, golf and
property conglomerate• Irish Government backs• NIB, Ulster, KBCR, other foreign
owned• International banks (Eircom)• Private and public “owners”
Why Sort it Out• Cons – Losses and job losses• Pros – Get economy going again,
restore reality to business• Redeploy economic resources to
economic activity• Issues – What’s a fair price???• Won’t solve bloated and happy public
sector I’m afraid
QUESTIONS
