Wilbur Ross -- 'The King of Bankruptcy' -- mortgages the future

Posted Sep 21st 2007 7:15PM by Tom Taulli
Filed under: Private Equity

Wilbur Ross loves distress. When industries are suffering near death – such was the case with steel and textile mills – Ross has figured out creative ways to capitalize on things and, yes, make a tidy fortune.

His latest target? It's the mortgage sector.

No doubt, it's not easy to be bullish on this. But Ross' philosophy is that – where there is bankruptcy, there is opportunity.

So according to a story on Bloomberg, Ross is willing to pay a cool $435 million for loan servicing division of American Home Mortgage Investment Corp.

The servicing business is usually a cash cow and as a result, should be a good foundation for consolidating the industry.

As with any savvy investor, Ross looks to the long term. That is, he knows that mortgages are necessary. So why not buy up a big piece of the market when prices are dirt cheap?

Seems smart to me.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Tags: American Home Mortgage, AmericanHomeMortgage, Bankruptcy, Wilber Ross, WilberRoss