DISTRESSED DAILY: Funds Will Target Smaller Troubled Companies

A record numberof funds raising fresh capital to lend to troubled issuers has led to a bifurcation in the market where bigger isn’t always better.

Instead, firms that invest in distressed debt are going smaller, according Kent Collier, founder and chief executive officer of media company Reorg Research.

“Over time, you’re going to see more specialized distressed funds piling into smaller credits,” Collier said on a recent webinar hosted by The University of Virginia’s McIntire School of Commerce.

With more companies under pressures from the coronavirus pandemic, investors big and small have significant opportunities.

“There is a ...