2016, 2016 VALCON: Emerging Valuation Issues in Bankruptcy and Beyond

The valuation of bankrupt and financially distressed firms is impacted by many factors including court decisions, changing business models, and macro-economic factors. This panel examines recent developments in these three areas and discusses how they will impact valuation engagements, particularly those performed in the context of litigation or contested matters in the future.

How does valuation factor into successful distressed investment strategies? Are valuations for distressed assets and companies increasingly dependent on an assessment of the underlying hard assets of target companies? How does commodity pricing risk factor in? What happens when valuations in general become too rich for firms to generate returns typically sought by distressed investors?

A discussion of core valuation methodologies and principles, and how those are applied (or should not be applied) to specific business sectors, with specific focus on the shipping industry, the oil and gas industry, and the healthcare industry.

The Tenth Amendment has been construed to require that a municipality in bankruptcy must maintain control over its assets and revenues, but the Bankruptcy Code requires that the municipality establish that its plan of adjustment is in the best interests of creditors and is feasible. This program will address that conflict and a range of other issues relating to valuation that arise in municipal restructuring cases, including valuing assets such as tax revenues streams, as well as such obligations as bond, pension and health care.

This panel will discuss the rationale and practical consequences of the nuanced approach to the often difficult concept of valuation in Chapter 11 taken by the ABI Chapter 11 Commission’s recommendations.