Cometh the hour, cometh the lawyer. That has long been the unspoken creed of America’s business world. But it is rapidly becoming the motto of the distressed debt arena too.
For in recent years, the benign nature of the credit cycle has made it hard for distressed debt funds to produce returns using classic routes. Consequently, one tactic which is increasingly fashionable is so-called “legal arbitrage” – or the business of exploiting legal loopholes to make a quick buck.
