At the 12th annual Corporate & Sovereign Credit Market Outlook luncheon, NYU Stern Professor Ed Altman offered his predictions as to the types of companies that will likely face bankruptcy in 2013. Altman, quoted in Reuters, notes that mid-market defense contractors, online media outlets, and coal companies could face a rough 2013.
With anticipated government cuts in the defense budget, Altman argues that mid-range companies who contract with the military will likely not withstand the cutbacks. In addition, coal companies could suffer, given the more cost effective resource found in natural gas. Altman also noted that online media venues could also face a decline.
In an interview with Reuters after his speech, Altman said the coal industry is expected to continue to suffer as natural gas remains a cheaper energy alternative. One major player in that industry – Patriot Coal Corp – filed for bankruptcy last year, blaming in part the glut of natural gas.
Altman said media companies will also face challenges as specialized online media outlets gain strength. “The Internet media world is getting very crowded,” Altman said in the interview.
Ed Altman is the Max L. Heine Professor of Finance at the Stern School of Business, New York University and taught Bankruptcy and Reorganization to the current MSRM class of 2013.