I Am CNBC Wilbur Ross Transcript

CNBC: Why did you decide to specialize in bankruptcy? 
WILBUR ROSS: It was happenstance. After Harvard Business School and the army, I went to the street.  The firm I was with, Wood, Struthers, and Winthrop is a very conservative firm, so they fired the guy who was running the venture fund.  I was the newest kid and they gave it to me to liquidate.

CNBC: So, it was just luck that you got involved bankruptcy? 
WILBUR ROSS: Yes, back then a lot of those companies weren't so good so I started doing that. Then later on I went to work for the Rothschild family.  The first thing they gave me to do was; Federal Express was about to go bankrupt. It was one of their big investments. I had to convince Citibank not to do it and a year later it went public, so it was serendipitous. 

CNBC: That was quite a turnaround, Federal Express. 
WILBUR ROSS: Yes, it became a wonderful company.  Then I just started doing it more and more. 

CNBC: When you bought out Rothschild you said that you felt a conflict between investing and advising? 
WILBUR ROSS: Yes, correct.  If Burlington Industries files bankruptcy do you try to become an advisor? Or do you try to buy the paper? You can't really do both.  So for a little while what we were doing, the first fund invested in smaller companies, and we just did the bigger companies on advisory. I finally concluded it was better just to do the investing.  I mean investing is a better business than advising.  Also when you're an advisor, you don't get to eat your own cookie.  You give people all this advice, they'll follow it, or they won't follow it.  When you're making the decision yourself, you don't have that intervening variable, you sink or swim based in what you're doing.  

CNBC: You were in kind of a unique position to have seen so many companies go through bankruptcy.  So you had a different attitude.
WILBUR ROSS: Yes, we had a very different attitude from most people in the distress business, in that, we came from the advisory side, so we've always had an industrial point of view, a kind of company restructuring point of view, not a trading point of view, not a high-yield-desk point of view, so it was a very different perspective. I really think that helps account for why our style is so different from that of most of the others with whom other people invest.

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