|$600 Billion Distressed Bank Debt Market Targeted
YORK and TOKYO - ereorg.com, Inc. announced that it has formed a joint venture with
Mitsubishi Corporation to introduce ereorg's institutional online debt auction system to
the Japanese market. The ereorg system enables users to buy and sell debt in the secondary
market in an anonymous and secure environment while significantly reducing transaction
costs and settlement times.
The Japanese secondary bank debt market presents a significant opportunity for ereorg.
Japanese distressed bank debt is estimated to exceed $600 billion. Bank debt as a percent
of GDP is nearly 100%, compared to 40% in theU.S. Furthermore, as the Japanese economy
recovers, the primary loan market is expected to grow rapidly. This trend is evidenced by
the aggressive expansion in Tokyo of the corporate lending groups of U.S. and European
commercial and investment banks. ereorg will be well positioned to capitalize on the
corresponding increase in secondary par loan trading.
ereorg is fortunate to have Mitsubishi as a partner in Japan. Mitsubishi is a world
class institution with over fifty years of experience and relationships in global trading
markets," stated Ronald DeKoven, Chairman and Chief Executive Officer of ereorg.
DeKoven added, "Given the vast size of the Japanese debt market and the demand for
portfolio restructurings, we have extremely high expectations for ereorg in Japan."
Announcing the joint venture, Yuji Komiya, General Manager of Mitsubishi Corporation's
Merchant Banking Department, stated, "we believe that ereorg will be an important
catalyst to increase liquidity in the Japanese debt markets. By offering an anonymous
channel for financial institutions to reach a wide range of qualified buyers, ereorg will
facilitate the efficient exchange of debt products."
In connection with the joint venture, Mitsubishi's U.S. merchant banking arm, MC
Capital Inc., invested in ereorg. Commenting on the investment, Shunichi Maeda, President
and CEO of MC Capital stated: "ereorg has assembled an impressive management team
with extensive experience in financial services and technology. Mitsubishi believes that
ereorg will transform global debt trading markets. In Japan, Mitsubishi and ereorg will
work together to introduce a full-range of debt trading products demanded by current
market conditions." MC Capital has been an active Internet investor with investments
that include Wit Capital, Intertrust and e-STEEL.
(Feb. 17, 2000)