TMA Distressed Investing Conference in Las Vegas

I am writing this from the TMA Distressed Investing Conference being held today and tomorrow at the Bellagio Hotel in Las Vegas. There are about 400 registrants representing a cross section of law firms, turnaround firms, and investment banks that make up the heart of the professionals serving the Restructuring market. There are a handful of distressed investment funds represented, but the paucity of such firms present suggest that many potential distressed investors are focusing on their own issues these days.

Conference Co-Chairs Jeffrey Fitts (of Alvarez and Marsal) and Andrew Miller (of Houlihan Lokey) did a great job of assembling some excellent panel topics and first rate speakers.

The event provided an excellent opportunity for me to get some updates on current trends from the program, as well as connect with friends in the industry who were kind to let me grill them on their perception as to where the industry is going.

The program launched really strongly with the morning being devoted to a thorough exploration of the twin Chapter 11 cases of American Color Graphics and Vertis: The First Dual Prepack Merger. Professors Laura Resnikoff and Edward Morrison, both of Columbia University did a superb job of setting up the dynamics that resulted in this first. The professionals involved in the case then provided their insights into how the dual prepack evolved.

My hypothesis, for this blog as well as for my consulting to firms looking to be among the winners in the Restructuring world, is that the Restructuring process is going to need to change as a result of changed circumstances in the environment. This case is a good example of the kind of innovations I expect to see more frequently, if the profession is going to be a contributor to effectively resolving the morass before this country.

My subsequent one-on-one discussions with Professor's Resnikoff and Morrison demonstrated they see changes occurring. Neither they...nor I...have a crystal ball, but they are seeing changes in processes by innovators (ala the dual prepack). As just one example, Professor Morrison has been studying the ratio of liquidations to restructurings over the years...a subject I will cover in subsequent posts.

The Thursday afternoon session started with the Keynote presentation by Harvey Pitt, former SEC Chairman and current CEO of Kalorama Partners. Harvey has the wisdom and experience to be very thoughtful about the changes that I (and more importantly he) believe are much needed to foster greater transparency in the capital markets. I always enjoy hearing Harvey speak, and this time time was no different.

Harvey Pitt's presentation was followed by excellent panel discussions on a more traditional Chapter 11 case (Radnor Case), on the toxic paper of Credit Swaps (my classification, not that of the speakers), and on challenges with exit financing.

Stepping back from the details of the day, I heard lots of change. Yet, I also talked to many professionals who seem more joyous that the pendulum had swung back to them than interested in learning how what has swung back is a very, very different pendulum.

Recently on my other blog, Prospering in Tough Times, I wrote about dinosaurs in other industries and in the general population. I guess I shouldn't be surprised that the Restructuring industry I so respect has its share of dinosaurs. Here is hoping that the voice of the innovators get heard so that the profession is at its best serving the enormous amount of troubled companies.

Up next: Day 2 of the Conference.