With recession forecasted in many economies this year or next, distressed situations will be an important source of deals for prospective investors. But what will matter is whether the targets are permanently impaired or can be turned around. Two real-life scenarios from the debt bubble of the early aughts and the ensuing credit crunch provide helpful guidance. The UK investment firm Candover bought the hygienic products producer Ontex (OTCPK:ONXXF) for €1 billion, or 8.1 times EBITDA, in 2002. The debt package, composed of bog-standard senior and mezzanine loans, totaled 6 times earnings.