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Loan Workouts and Debt for Equity Swaps: A Framework for Successful Corporate Rescues



Loan Workouts and Debt for Equity Swaps: A Framework for Successful Corporate Rescues

Subhrendu Chatterji, Paul Hedges

ISBN: 978-0-470-84544-8 July 2002 334 Pages


The key to a successful loan workout is to identify the problemsaccurately and address them early. It is critical that thecompany's underlying business and financial problems are resolvedand not merely the symptoms.

Loan Workouts and Debt for Equity Swaps examines how a successfulloan workout can be managed. It detail the processes andparticipants involved, whilst providing frameworks and practicalstep- by-step approaches that allow for a coherent and cohesivepolicy to give the best possible chance of success. The bookassists in the ultimate aim of providing a firm base for the futurehealth of the company involved and maximizing the lenders' returns.This work is not merely restricted to companies and banks involvedin the process, but other important participants in loanworkouts.
Areas featured in the book are:
* What loan workouts are and why they are needed
* Non-performing loans related strategies, organization andsystems
* Participants involved in loan workouts and theirmotivations
* Symptoms of corporate distress and corporate turnaroundstrategies
* Major steps involved in a typical loan workout transaction
* Special issues relating to debt for equity swaptransactions
* A case study illustrating many of the issues covered in the book
Foreword by David Wilson Havelock.



Loan Workouts: What They are and Why They are Needed.


A Framework for Managing Non-Performing Loans.

Organisation and Systems Relating to Non-Performing Loans.

Managing Loan Workout Transactions.

The Company.

The Banks.

Other Key Participants in Loan Workouts.

External Advisors.

A Framework for Executing Loan Workouts.

Turning Around a Business.

The Information Gathering and Review Process.

Exploring Loan Workout Options.

Evaluating Restructuring Options and Developing Proposals.

Negotiating and Completing Transactions.


Establishing a Moratorium.

Financial Creditors Affected by a Moratorium

The Operation of Facilities in a Moratorium.

The Concept of Loss-Sharing.

Multi-Currency Considerations.

Financial Restructuring.

Inter-Creditor Provisions in a Financial Restructuring.

Other Terms and Conditions.

Introduction to Debt for Equity Swaps.

Transaction Approach.

Equity Instruments.

Other Transaction Parameters.

Other Technical Issues.


Project Gloucester.

"The book is needed quite simply because there is a dearth of information on corporate restructuring. At present the number of receiverships is going down and the emphasis is on workouts. In this respect the book is very timely.", , , #"I", , , #