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Distressed Debt Market Still Robust

Sales of distressed debt remained strong in the third quarter, according to Kaulkin Ginsberg.

"The recent liquidity crisis in the debt markets has not made any significant impact on deals" in the accounts receivable management business, Michael Lamm, an associate at Kaulkin Ginsberg said. While fewer deals have taken place, those that have been completed have been for larger dollar amounts.

Total deal value of acquisitions and mergers of accounts receivables was $2.12 billion in the third quarter.

Significant deals in the third quarter included the acquisition of AllianceOne by Teleperformance.

In another major deal, Sherman Financial Group's management team bought a substantial amount of equity in their firm from mortgage insurers Radian Group and MGIC.

Mr. Lamm said that it's too early to know if volatility in the financial markets will have a residual impact on accounts receivables management deals.

"However, our knowledge of pending transactions in the market and the number of interested buyers out there suggests that we should continue to experience a robust level of deal activity at least into 2008."

Kaulkin Ginsberg is a strategic advisor for accounts receivable management firms.

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