Can Zombie Firms Survive Rising Interest Rates?
Companies that can’t pay their debts are supposed to turn things around or go out of business. But across the world, a rising number of “zombie firms” are limping along, unable to pay their debts but somehow hanging on. Now, with interest rates rising, the question is whether the zombies will start…
✒ Rising interest rates will likely push more zombie firms into bankruptcy, and it will push more healthy firms toward zombie status.
If zombies start dying off, it could be painful in the short run. But it might present acquisition opportunities for stronger companies too.