Despite the strong stock market performance and the low interest rate environment, financial distress, as measured by the number of Chapter 11 bankruptcy filings, is gradually increasing in both general Chapter 11 and real estate. The exception to this “gradual” increase is in healthcare, which has seen filings spike to record-high numbers filings over the past two years, as documented in the Polsinelli/TrBk Distress Indices.
Some reasons for the increased distress in healthcare are obvious, such as those related to a new regulatory and economic environment created under “Obamacare...
The positive economic climate seen around much of the world is a mixed blessing for restructuring and turnaround professionals. We continue to see signs of growth from investment in infrastructure and energy, consumer spending, job creation, and asset value appreciation, all without the inflation and interest rate increases that typically accompany this climate. Sectors such as retail are facing continued challenges from disruption to their business models, but in general distressed companies of late have arisen from more isolated issues or unfortunate events than from systemic, sector-...
Distressed investing has been strong since the collapse of the financial markets in 2008, but as the economy has continued to expand, it has become increasingly opportunistic. It appears that the U.S. economy, which is heading into its ninth year of expansion, will continue to expand, with low interest and inflation rates, consumer spending growing at approximately 2.5 percent, low unemployment with high job growth that is bringing the United States to the verge of structurally full employment, and real GDP growth at around 2.3 percent.
When I was asked to serve as guest editor for JCR’s energy-focused edition last year, in trying to cover a breadth of developing trends across the industry we asked authors to focus on the investor and considerations that were important in making the investment decision.
Since that time, the energy world has fundamentally changed. The decline in crude from the high $80s per barrel to the low $40s per barrel is driving a shakeout in the oil business of a magnitude that hasn’t been seen since the mid-1980s. While production volumes continue their surge, drilling programs are...
Even though default rates and corporate Chapter 11 filings remain at historic lows, a number of industries have been experiencing financial distress, including oil and gas, retail, higher education, and food processing. Hot topics affecting restructurings in all industries include potential limits on credit bidding, gifting, and other mechanisms to circumvent the priority scheme established under the U.S. Bankruptcy Code and the Section 546(e) safe harbor. Therefore, we have assembled a distinguished panel of authors to discuss these three hot topics and these four hot industries.
There is no question that we are living through the most dynamic U.S. retail environment since Wal-Mart rolled out nationwide in the 1990s. This time, it’s not a better operator dominating in head-to-head competition, but rather the tipping point of digital commerce and the advent of fast fashion that are changing the retail landscape.
While neither of these trends is new, their penetration into traditional retail leaves no room for underperforming retailers. Where once retailers chose between brick-and-mortar and omnichannel strategies, all are now somewhere along the omnichannel...
In my role as a guest editor of the JCR over the past couple of years, I have asked authors to focus on topics related to the energy business from the perspectives of both the investor and the turnaround professional. This year we have shifted to a survey format covering a broad range of topics with the objective of providing useful insights and tools for turnaround professionals. We have also included an article to add an international perspective, recognizing the full importance of turnaround practices in international markets and TMA’s global footprint.
As a longtime writer for the Journal of Corporate Renewal, I was delighted to be asked to act as guest editor for this issue. Traditionally, TMA has had themes for each JCR issue. This year, it has moved away from them, in large part to make sure that the JCR can cover timely topics relevant across the restructuring world, rather than having each issue impact only specific subgroups.
At the same time, I found it ironic as topics came together for this issue that the articles came primarily from two worlds—consumer goods and (if you know me, you probably...
When I last served as guest editor for the JCR, we focused exclusively on an industry familiar to most turnaround practitioners—construction contracting. This time around, readers have the opportunity to dive into a wealth of knowledge spanning a number of current and pervasive topics impacting the turnaround and restructuring profession.
Steve Roach and Ronald Spinner of Miller Canfield have co-authored an article on a familiar, but often overlooked, subject that we all find ourselves having to deal with from time to time—preference actions. The authors offer some helpful...
Nonprofits are big business, with more than 1 million entities contributing 5 percent of the U.S. gross domestic product. The size and prevalence of nonprofits are also visible in the donations of time and treasure. Last year, more than 63 million Americans volunteered their services to nonprofits, and $389 billion was donated to charities, a 4.2 percent increase over 2015.1
Because of growth in the sector, turnaround professionals are working with increasing numbers of nonprofits with increasing frequency. In addition, many turnaround professionals serve in...
