x

Our Privacy Policy has changed. By using this site, you agree to the Privacy Policy.

Distressed Debt Analysis Strategies for Speculative Investors

ISBN-10: 1932159185
ISBN-13: 9781932159189
Edition: 2004
Authors: Stephen G. Moyer
Buy it from $115.81
eBook available
This item qualifies for FREE shipping

*A minimum purchase of $35 is required. Shipping is provided via FedEx SmartPost® and FedEx Express Saver®. Average delivery time is 1 – 5 business days, but is not guaranteed in that timeframe. Also allow 1 - 2 days for processing. Free shipping is eligible only in the continental United States and excludes Hawaii, Alaska and Puerto Rico. FedEx service marks used by permission."Marketplace" orders are not eligible for free or discounted shipping.

30 day, 100% satisfaction guarantee

If an item you ordered from TextbookRush does not meet your expectations due to an error on our part, simply fill out a return request and then return it by mail within 30 days of ordering it for a full refund of item cost.

Learn more about our returns policy

New Starting from $115.81
eBooks Starting from $64.95
Rent
Buy
what's this?
Rush Rewards U
Members Receive:
coins
coins
You have reached 400 XP and carrot coins. That is the daily max!
You could win $10,000

Get an entry for every item you buy, rent, or sell.

Study Briefs

Limited time offer: Get the first one free! (?)

All the information you need in one place! Each Study Brief is a summary of one specific subject; facts, figures, and explanations to help you learn faster.

Add to cart
Study Briefs
Business Ethics Online content $4.95 $1.99
Add to cart
Study Briefs
Business Law Online content $4.95 $1.99
Add to cart
Study Briefs
Management Online content $4.95 $1.99

Customers also bought

Loading
Loading
Loading
Loading
Loading
Loading
Loading
Loading
Loading
Loading

Book details

Copyright year: 2004
Publisher: J. Ross Publishing, Incorporated
Binding: Hardcover
Pages: 450
Size: 6.00" wide x 9.00" long x 1.00" tall
Weight: 1.870
Language: English

Notes on Style
Acknowledgments
About the Author
Web Added Value
Introduction
An Example of a Distressed Debt Situation
What Is Distressed Debt?
Investing in Distressed Debt
The Distressed Debt Investment Opportunity
Financial Restructurings in the 2000-2003 Era
Precursors to Default
Economic Performance
Relative Quantity of Low-Rated Bonds
Capital Markets Liquidity
Market Conditions That Permit Superior Returns
Equal Access to Information
Rational Behavior
Low Transaction Costs
Summary
Conceptual Overview of Financial Distress and the Restructuring Process
A Simple Model of the Firm
Extensions of the Basic Model
A Conceptual View of Financial Distress
How Restructurings Attempt to "Fix" the Distress
Summary
Legal Overview of Distressed Debt Restructurings
Out-of-Court Restructurings: The Preferred Option When Effective and Feasible
The Financial Effects of an Out-of-Court Restructuring
The Out-of-Court Restructuring Process
Parties Involved
Strategic Considerations in Participating on the Bondholder Committee
Beginning the Process
Implementing the Restructuring
Feasibility: The Holdout Problem
Summary
In-Court Restructurings: An Overview of the Bankruptcy Process
Declaring Bankruptcy
Jurisdiction of Filing
Timing of Filing
The Goal: The Plan of Reorganization
The Role of Exclusivity and Prefiling Coordination
Content and Structure of the Plan
Operating Under Chapter 11
Stabilizing Operations
Developing a Going-Forward Business Plan
Determining the Assets and Liabilities
Determining the Valuation and the New Capital Structure
Voting on and Confirming a Plan of Reorganization
Summary
Overview of the Valuation Process
The Basics of Cash-Flow-Based Valuation
Using EBITDA as a Measure of Cash Flow
Understanding and Adjusting EBITDA
Limitations of EBITDA
Comparing Discounted Cash Flow and EBITDA Multiple Approaches
Comparable Company Analysis Based on Enterprise Value
Calculating Enterprise Value
Determining the Correct Multiple
Using Comparable Company Analysis
Alternatives to the EBITDA Multiple Approach
Revenue-Based Valuations
Asset-Based Valuations
Customer-Based Valuations
Liquidation Valuations
Summary
Leverage and the Concepts of Credit Support and Capacity
The Interrelationship of Credit Risk and Credit Support
Credit Risk
Credit Support
Credit Capacity
Credit Capacity as Measured by Debt Repayment Ability
Stable Cash Flow Scenarios
Volatile Cash Flow Scenarios
Debt Capacity Under Alternative Criteria
Asset Coverage
Ability to Refinance
Interest Expense Coverage
Capital Instruments Designed to "Avoid" Credit Capacity Criteria
Exchangeable Preferred Stock
Convertible Bonds
Discount Notes and Payment-in-Kind Notes
Summary
Capital Structures and the Allocation and Management of Credit Risk
Using Corporate and Capital Structures to Allocate Credit Risk
Grants of Collateral
Contractual Provisions
Maturity Structure
Corporate Structure
How Capital Structures Manage Credit Risk
Leverage
Priority
Restricted Payments
Negative Pledge Clauses
Time
Performance Covenants
Put Rights
Forced Call in the Event of a Downgrade
Performance-Linked Pricing Provisions
Summary
Causes of Financial Distress and the Restructuring Implications
Indicators of Financial Distress
Debt Ratings
Predictive Models
Market Prices
Causes of Financial Distress
Performance Materially Below Expectation
Economic Downturn
Uncompetitive Product or Service
Unrealistic Business Plan
Poor Management
Near-Term Liquidity Issues
Bank Debt Scenarios
No Bank Debt Scenarios
Unexpected Liabilities
Tort Claims
Contract Liabilities
Crisis of Confidence: Fraud and Other Events That Create Financial Uncertainty
Reliability of Historical Financial Data and Valuation Issues
Liquidity and the Likelihood of Bankruptcy
Summary
Options for Alleviating Financial Distress: The Company's Perspective
Properly Assessing the Distressed Firm's Likely Actions Is Key to Assessing the Investment Outcomes
Playing the Waiting Game
Between a Rock and a Hard Place
Summary
Strategic Options to Resolve Financial Distress Outside Bankruptcy
Raise Additional Capital
Asset Sales
Secured Financings
Sale/Leaseback Financings
Equity Sponsors
Reducing Leverage
Open Market Repurchases
Direct Purchases from Holders
Cash Tender Offers
Exchange Offers
Coercive Exchange Offers
Noncoercive Exchange Offers
Constraints on the Range of Options
Liquidity
Time-to-Liquidity Event
Magnitude of Problem
Complexity of Capital Structure
Severability of Business Units
Cause(s) of Financial Distress
Strategies When Bankruptcy Appears Necessary
Maintaining Liquidity
Preplanned Filings
Summary
Profiting from Financial Distress: The Investor's Perspective
Defining the Investment Objectives
Tailoring a Strategy to the Investment Objectives
Non-Chapter 11 Situations
Passive Involvement
Active Involvement
Chapter 11 Situations
Feasibility Considerations
Capital Structure
Market Versus True Valuation
Market Liquidity/Concentration of Holdings
Other Distressed Investors
Bank Debt
Large Block Holders of Public Debt
Hedging and Capital Structure Arbitrage
Return Potential of Capital Structure Arbitrage
Common Capital Structure Arbitrage Trades
Pari Passu Securities with Different Maturities
Senior Versus Junior Securities
Bonds Versus Equity
Summary
Practical Aspects of the Investment Process and Due Diligence
Practical Realities of the Investment Analysis Process
Screening Situations to Prioritize Opportunities
Reacting to Volatile Situations
A Time-Efficient Valuation Methodology
Performing Due Diligence
Diligence Cost-Benefit Analysis
Prioritizing the Diligence Issues
Financial Due Diligence
Basic Goals of Financial Due Diligence
Obtaining Publicly Available Financial Information
Accessing Management
Special Valuation Considerations in Financially Distressed Contexts
Business Deterioration During a Reorganization
Reorganization Costs
Critical Vendor Payments
Cash Accumulation During the Reorganization
Tax Issues
Liquidity Implications of a Distressed Firm's Current Tax Status
Potential Value from Carryforward of Net Operating Losses
Priority Status of Tax Claims
Legal Due Diligence
Obtaining the Relevant Documents
Checklist of Legal and Bankruptcy-Related Issues to Consider
Voidable Preferences
Substantive Consolidation
Structural Advantages
Equitable Subordination
Zone of Insolvency
Special Considerations When Investing in Claims That Are Not Negotiable Instruments
Recent Developments Under the Sarbanes-Oxley Act of 2002
Mechanics of Accumulating the Investment
Investment Strategy and Market Environment Drive Accumulation Approach
Consummating the Trade
Firm Market
No Market or Above-Market Offering
Settling the Trade
Bank Debt
Holder Identity
Settlement
Special Considerations for Revolving Loans
Summary
Dynamics of the Workout Process: The Endgame
The Parties
The Debtor
Debtor's Bankruptcy Counsel
Debtor's Financial Advisor
The Committee
Committee Legal Counsel
Committee Financial Advisor
The Secured Creditors
The Bankruptcy Judge
Types of Chapter 11 Cases
Preplanned Restructuring
Full Prepack
Prenegotiated Filings
Asset Sales
Sales Intended to Enhance Recoveries by Maximizing Estate Value
Sales Designed to Maximize Creditor Recoveries
Free-Fall and Contested Chapter 11 Reorganizations
Sources of Leverage in the Chapter 11 Process
Delay
Management and the Right of Exclusivity
Creditors and the Threat of Litigation
Priority
Secured Creditors
Valuation
Voting and Confirmation
Voting
Confirmation
Summary
Postreorganization Considerations
Postreorganization Equities
Size of Expected or Probable Market Capitalization
Postreorganization Trading Float
Forced Sellers
Company Profile
Postconfirmation Lockups
Tax-Based Trading Restrictions
Warrants
Trading Performance of Back-End Equities
Postreorganization Debt Securities
Liquidating Trusts
Summary
Endotes
Literature Survey and Selected References
Chess Notation and Game Moves
Disclosure of Possible Conflicts of Interest
Index

×
Free shipping on orders over $35*

*A minimum purchase of $35 is required. Shipping is provided via FedEx SmartPost® and FedEx Express Saver®. Average delivery time is 1 – 5 business days, but is not guaranteed in that timeframe. Also allow 1 - 2 days for processing. Free shipping is eligible only in the continental United States and excludes Hawaii, Alaska and Puerto Rico. FedEx service marks used by permission."Marketplace" orders are not eligible for free or discounted shipping.

Learn more about the TextbookRush Marketplace.

×