Steven Agran, Managing Director at Carl Marks Advisors, shares his outlook on the turnaround industry as the newly appointed NJTMA President.
How valuable has your involvement with TMA been for your career over the past 15 years?
I first joined NJTMA to meet people in the industry, hone my networking skills and learn more about the nuance of turnaround. However, as I became more involved, I also became a more active member of the organization, holding roles such as TMA Mid-Atlantic Symposium co-chair, Treasurer of NJTMA, and Global TMA Board Member. Each and every one of my experiences with TMA has helped me expand my network, learn from other professionals, and demonstrate my experience and work ethic – even to those who have never hired me for a project.
Aside from expanding membership, what other objectives do you have for 2018 as President of NJTMA?
This year NJTMA celebrates our 25 year anniversary, yet most people do not really know what the turnaround industry is. I’d like to engage our members to promote the broader turnaround industry – and of course, have fun, which is contagious.
I also think it is important to expand the reach of NJTMA to address the needs of lenders, investors and industry leaders as they navigate the tumultuous world of distress. These are people that can benefit from our skill set and knowledge of the turnaround industry. I believe this can be achieved by adding CPAs, bar associations, factors and other industry groups to the established relationships we have with CFA, IWIRC and ACG.
How much is the lower middle-market a focus for TMA members, and what are central/primary discussion topics?
The whole middle market is of interest to the TMA as most members work with mid-market companies with revenues ranging from $25MM to $1B. A recent concern has been the stagnation of the economy and the resulting lack of activity within the turnaround industry. With the pick-up of the economy, we would expect to see additional M&A activity, which will ultimately add more leverage on companies and in turn leading to greater distress in the market.
Are there certain industries or types of businesses you foresee encountering extraordinary distress in 2018?
I think healthcare, education and retail will all continue to have issues, but another challenge could be in the banking sector as banks continue to consolidate. Additionally, the current high multiples on private equity acquisitions will add extensive leverage and may become an issue.
We are also going through a continued economic revolution and business is changing rapidly. The impact of autonomous vehicles will have a major impact on the auto industry but even more so on the trucking and transportation. Cryptocurrency is a hot topic, but not very well understood and may result in the development of a bubble.