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Duff & Phelps Pursues Distressed M&A
February 6, 2008
Investment banking and financial advisory shop Duff & Phelps announced the formation of a special situations M&A practice group targeting middle-market companies and private equity firms.
One of the primary services, which was already offered by Duff & Phelps prior to the new group's establishment, is M&A guidance on transactions involving underperforming or financially distressed targets, including Chapter 11 Section 363 and out-of-court divestitures.
"Unprecedented credit conditions in the marketplace are impacting a significant number of middle-market companies, even those without stress on the balance sheet," said Steve Burt, managing director and head of M&A, in a release. "Our special situations M&A practice brings together bankers with expertise in restructuring and M&A who possess intimate knowledge of the debt markets, bankruptcy procedures as well as the ability to manage a sale process in the midst of contentious parties. Moreover, with offices across the U.S., Europe and Asia, we are well positioned to offer counsel in key markets around the world."
Duff & Phelps cited a statistic from Dow Jones in its announcement — private equity fund-raising specifically for distressed investments topped $48 billion in 2007, 300% more than 2006.
"Hedge funds, sponsors and institutions are amassing large pools of capital for distressed investing, and they are scouring the market for investment opportunities," Russell Belinsky, senior managing director of restructuring, in the release. "Meanwhile, the credit crunch is putting a strain on companies and their ability to borrow. As a result, some of these companies will look to sell underperforming operations or assets to raise capital. This puts our special situations M&A practice in an ideal position to leverage our relationships and find natural buyers for these assets."
Belinsky co-founded Chanin Capital Partners, which Duff & Phelps acquired in November 2006.
In December, Duff & Phelps created two management positions, including one for Burt, who became head of investment banking and retained his previous role as head of M&A.
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