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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
| Source: Krull Corporation
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.
For more information, visit www.KrullCorp.com.
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.