LONDON (Reuters) - The number of German companies overburdened with bad debt is in decline, a specialist in investing in bad-loan portfolios said on Wednesday, a sign he said showed that Europe's biggest economy was on the mend.
"We are seeing the economic data come out of that country, and it is being reflected in the lack of (distressed debt) opportunities," said Sid Shamnath, investment manager with Titanium Capital, a hedge fund with about $500 million under management.
"There were a lot of opportunities in the early part of last year," he said at the Reuters Hedge Funds and Private Equity Summit in London. "Many have since recovered quite well and are no longer distressed. It is an encouraging sign for the main economy."
About one third of Shamnath's hedge fund is invested in bad-debt portfolios.
ECONOMIC PATRIOTISM
Shamnath, who scours Europe for investment opportunities, said he was also frustrated by the wave of protectionism sweeping Europe, but said it was often driven by practical fears rather than nationalism.
For example, Germany's E.ON EONG.DE recently launched a bid for Spain's Endesa (ELE.MC: Quote, Profile, Research, Stock Buzz), but the Spanish government tried to hamper the deal by giving the country's energy market regulator power to investigate it.
"I don't see it driven by nationalist attitudes. It is more to do with the fact that energy prices have gone through the roof. It is a way for governments to have control," he said, while singling out France, which is facing legal action from the European Commission for restricting foreign shareholdings in what it considers sensitive sectors, as an exception.
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