European Distressed Debt Market Outlook 2014

30 January 2014

Download Publications (6.96 MB)

Funds ready to invest billions in European distressed opportunities in 2014

Macro headwinds permitting, 2014 is set to remain awash with liquidity. Rampant primary markets will enable companies to refinance and private equity groups to extract more dividends and hit the acquisition trail again, according to Debtwire Europe’s 10th European Distressed Debt Outlook, produced in association with Bingham McCutchen and Rothschild.

Other highlights of the report include:

  • 2013 saw US and European economies boosted by central banks’ commitment to ultra-low interest rates. Return-hungry investors keen to put money to work and surging inflows into high-yield funds have sent secondary prices rocketing, and helped businesses to escape workouts.
  • Last year, many European banks took advantage of high secondary prices to dispose of junk assets -but more needs to come out to clean up balance sheets, particularly in Southern Europe.
  • “Supply will meet the demand of US hedge funds ready to buy everything that trades and bet billions of dollars on Europe’s macro economic recovery. The show will go on,” Mario Oliviero, Debtwire Europe’s Deputy Editor said.

For the report, Debtwire canvassed the opinions of 100 hedge fund managers, long-only investors and prop desk traders as well as 30 private equity investors in Europe on their expectations for the European distressed debt market in 2014 and beyond.