Mark Kanaly served as a panelist during this webinar hosted by Strafford
on September 2, 1:00pm -2:30pm. Given the increasing rate of U.S. commercial bankruptcies and the complex valuation and analytical methods, valuations of distressed companies (sometimes in a restructuring outside of bankruptcy) represent an increasingly important advisory activity, especially when working with debtors. Valuation analysts play a key role in pre-bankruptcy activities such as solvency-insolvency analyses, in-bankruptcy matters like creditor interest analyses, and post-bankruptcy matters including fair value accounting and Sect. 363 or restructuring asset sales. The program presented scenarios involving distressed company valuations that apply to any number of industries, to a bankruptcy filing and to an outside bankruptcy restructuring. Relevant guidance like ASC Sec. 852-10 and IRC Secs. 382 and 383 factor into these scenarios. The following topics were covered during the program.
The panel analyzed when, where and why basic valuation approaches are utilized in these and other distressed company situations.
- Pre-bankruptcy: Solvency or insolvency analyses, avoidance of fraudulent transfers, creditor collateral value analysis and other matters.
- During bankruptcy: Income tax attributes, DIP fairness and liquidation/reorganization analyses, and other matters.
- Post-bankruptcy: Fair value accounting asset and business valuation issues, income tax attribute protection, Sect. 363 sales and other matters.
- Business restructurings outside of the bankruptcy process.