As Argentine country risk rises above 1,800 basis points, tax
revenues slump and wild rumors circulate daily regarding the
government's ability to retain the decade-old currency board
system, this may not appear to be the right time to consider
longer-term investment opportunities. Yet moments of maximum
desperation are often moments of great opportunity.
The Investors' Club
Nearly all sources of conventional financing for Argentine companies have dried up. Several local financiers have come up with some new ideas for finding financing fresh management and talent for local companies.
One trend in financing the country's struggling corporate
sector is the emergence of a nascent management buy-out and
buy-in market. MBO/MBI financing has contributed much to
entrepreneurial growth in the US and the UK. Financiers and
business people in continental Europe and in markets even
further afield, such as in Singapore and Malaysia, are turning
to these methods.
Argentina offers fertile ground for this activity. It has a
mass of SMEs, many of which are family-owned and face serious
financing and succession problems. The lack of a developed
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