SOURCE: Krull Corporation

Krull Corporation

April 21, 2009 15:16 ET

Dr. Alexander Mirtchev Considers That Even Though Economic Crisis Has Not Reached Bottom, "Bottom Fishing" by Multinationals, Private Equity and Sovereign Wealth Funds Has Begun

Krull Corp. President Alexander Mirtchev Considers That Despite the Growing "Buzz" That the "Worst Is Over" for the Economy, the Unfolding of the Crisis Is Going to Be Prolonged; the Time Is Right to Invest in Undervalued Assets and There Are Signs of Increasingly Active Pursuit of Undervalued Assets by Multinationals, Sovereign Wealth and Private Equity Funds

WASHINGTON, DC--(Marketwire - April 21, 2009) - In an interview with Reuters Dr. Alexander Mirtchev, founder and president of Krull Corporation and macroeconomic expert, analyzed the signs of optimism in certain market sectors, and indications that investment activity is intensifying. "It can be said that we are seeing positive signs, strengthened by the perception that the 'bad news' from the financial sector has come to light and the market is 'tired' from the continued 'doom and gloom'," he said. "However, there remain a number of economic and financial imbalances that could become full-fledged impediments for growth. We are yet to see the full effects and damage of the financial crisis on industrial projects and production activity as they tend to 'lag' with cuts in financing and investment taking a certain period of time to affect capacity."

Dr. Mirtchev notes that a number of multinationals, sovereign wealth and private equity funds, have started to proactively look for deals among the distressed assets left in the wake of the crisis worldwide. "The period of 'withdraw and regroup' for private equity funds, venture capital investors, sovereign wealth funds and other significant market players, is more or less over. Even though the end of the crisis has not yet been reached, 'bottom fishing' has already started," said Mirtchev.

In assessing investment opportunities, funds and companies would pay special attention to China, Russia, India, Malaysia, Brazil, Chile and the countries of Central Asia. "A number of investors have reached the position that asset values have gone down sufficiently for attractive targets to arise, in particular those that would be in line with their core strategies and are considered of future significance. Private equity funds and SWFs would be more tempted to forego immediate returns for potential growth in the mid-term, relying on acquisitions that provide synergies and economies of scale with assets and production facilities that they already own. In addition, numerous investment targets that are drawing interest appear to notably carry a high level of uncertainty. But an understanding seems to be emerging that the current economic situation has changed the framework of risk-reward perception among investors," said Mirtchev.

"As some industries are likely to outpace others, the returns on investment from select rapidly developing economies and emerging markets could prove, in the mid-term, to be stronger than currently anticipated. Other sectors that are perceived to still be subject to downward pressure would need to make efforts to take advantage of possible multi-sector synergies to attract the attention of major investors," said Mirtchev.

"Private equity funds, sovereign wealth funds, and investment companies would be keeping a close watch on developments in these markets, and should be prepared to move quickly to take advantage of opportunities that arise on the path to recovery. However, revival of equity investment appetite may provide a further boost for those sectors that appear to have reached the trough of the growth curve, with targeted investment activity being liable to focus on specific industry sectors, thus adding to the 'patchiness' of the recovery," he added.

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About Krull Corporation

Krull Corporation is a Washington, DC-based advisory and project management firm with expertise in dealing with economic growth, industrial expansion and restructuring issues. Founded by Dr. Alexander Mirtchev in 1992, Krull Corporation capitalizes on his extensive professional experience in market developments and reforms and focuses primarily on emerging and transitional economies. Over the years, the firm has provided its clients with outstanding strategic guidance and professional services in various areas. Combining a unique blend of global reach and understanding of local markets, Krull is able to consistently produce high quality results and returns.

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