"Vulture funds"

[ThePickleReport]

If you read Sunday's Buffalo News, on the front page of the business section there's an article titled "Vulture funds could snap up deflated assets". One of those funds is Oaktree Capital Management that the article quotes in having over $10 billion to invest in distressed debt.

Why is that significant? Oaktree is a player in radio financing.

 

[Bob1370]

Pluses and minuses in this...

On one hand, it's always helpful when someone comes in and financially stabilizes an industry that's got long term potential but faces current, though transitory, troubles that can wound many of its major players.

On the other, radio is one business that, almost more than any other with the arguable exception of the car business, needs to be run by people who know and care about the product and about meeting customers' expectations for the product. We've already seen what happens when bean-counters ignorant of the business they're running and just looking for cash flow first, product a distant second, take over both the car business and the broadcasting business. They're both in the crapper as a direct result. Trading stations from one set of bean counters to another won't make matters any better and could make them worse. We need to do whatever is possible to make sure the next generation of broadcast managers and owners are communications people who care about what they're doing and not just how much money it'll put in their pockets every month. We've all worked for such people and know what they look like when we see them. These are the people we need to seek out now, while there's still time...

 

[SirRoxalot]

I think that Wall Street sees radio as facing so many challenges right now that it's considered toxic. I think that the only deals we'll see are mega-corps divesting small markets that they've already automated and aren't making money on.

 

[umtrr-author]

If I may put on my Ruthless MBA hat on for a moment, I'll note that they're called "Vulture" funds for a reason.

Buy the distressed business, pick it clean of anything worthwhile and toss the rest.

Many of the ROI cases for such purchases involve further "rightsizing."

 

[Element9]

What would we do without bean-counters?

Seriously. The guy who does my taxes (and advises me to save for a rainy day) is a genial guy who's worked for the IRS as well as a few noteworthy accounting firms. He's a CPA, and last I checked, you can't get one of those in a box of cereal.

Can we at least make a distinction between genuinely concerned, talented and educated accountants, many of whom are CPA's, charged with protecting our assets by diligently watching the books and making sure all the numbers add up and those carpetbaggers who've helped to drive the radio industry into the ground by means of greed and abject ignorance?

And upon checking our 401(k)'s, we might be surprised to find that some of the funds we hold may own a (small) piece of a hedge fund or lending institution (charging usery rates) that got its nose a little too close to the wringer.

I'm at the point of believing we're all in this swamp together and we're all starting to stink like dogs. Of course, we don't stink as much as the bigger dogs.

Which brings me to a memorable quote from the esteemed playwright, Oscar Wilde. One evening, after a night of carousing and binging, Wilde entered a carriage occupied by a few men and women considered to be pillars of the community. Detecting Mr. Wilde's pungent aroma, one of the women turned up her nose and said, "Sir, you smell!"

Wilde responded as only Wilde could, "Madam, you smell... I stink!"