'Buy American' gets a whole new meaning

The recent growling back and forth between China and the United States leaves no doubt that we are in the year of the tiger. These political frictions - which, hopefully, will soon be resolved by responsible government actions on both sides - should not distract from a unique historic economic opportunity: a robust marketplace for financially distressed US businesses and assets. Indeed, while the US is currently one of the most vibrant merger and acquisition (M&A) marketplaces, it may be all too easily overlooked, or even deemed inaccessible, by Chinese investors.

In the wake of the global economic crisis, the marketplace for financially distressed assets has essentially become the epicenter of M&A activity in the US. Trends in China and the US both have intersected to create a unique historical moment that should yield extensive investment opportunities: Chinese investors are flush with capital, coupled with a demand for overseas investments, and there is an abundant supply of financially distressed assets currently in, or headed to, US bankruptcy courts.

It should be no surprise to Chinese investors that the US distressed marketplace offers bargain-priced assets that are being sold for prices far below historic valuations. Moreover, there is at present an abundant supply of financially distressed businesses and assets - all for sale one way or another in US bankruptcy courts. This is especially so for financially distressed US real estate. According to a recent report by the US Congressional Oversight Panel, about $1.4 trillion of distressed real estate loans will come due in the next four years.