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Lynn Tilton, CEO and founder of Patriarch Partners LLC, which runs over $6 billion worth of assets, expects tremendous opportunities for value investors to come about as a result of the subprime mortgage mess and the ailing CDO market. Her name has been, in recent years, synonymous with Mesa, Ariz.-based MD Helicopters Inc., an aerospace company that produced no revenues when she purchased it in 2005 and last year recorded a profit in the fourth quarter. Tilton likens her turnaround of MD Helicopter to TPGs turnaround of Continental Airlines. It is a deal she believes Patriarch Partners will be best remembered for.
MDs helicopters are used by US, Turkish and German police departments. One of the helicopter makers products is used by the US Armys 160th Special Operations Aviation Group known as the Night Stalkers at Fort Campbell, Ky.
She prides herself in thinking independently. Sometimes I miss upside markets, but its just my style - not to pay attention to or to focus on what others do, says Tilton, who founded Patriarch and has gotten involved with the nitty gritty of companies, including union negotiations.
Tilton earned a BA in American Studies at Yale University and an MBA in finance from Columbia University. She started her career at Morgan Stanley and for 10 years was an investment banker at firms such as Goldman Sachs, and Merrill Lynch where she was involved with M&A and LBOs. Tilton has also been involved with sales, trading and investing in distressed debt at Oppenheimer & Co., M.J. Whitman, and Amroc Investments. Tilton also patented a method of reselling distressed and non-performing notes into AAA notes.
Aleksandrs Rozens
IDD: You have expressed concerns about the economy and the weak dollar. What is behind these concerns?
TILTON: I dont think people understand the potential danger to a weak dollar, especially at a time when this country is heading into a downturn. Everyone acts like the Fed can use one tool to pulse the economy without consequences. One cant lower interest rates without a consequence to the dollar. One cant infuse capital into the system ... without losing value in the dollar. There is a reaction to every action and I think that people often fail to see the clarity...