Optimal debt and equity values in the presence of chapter 7 and chapter 11

被引:96
作者
Broadie, Mark [1 ]
Chernov, Mikhail
Sundaresan, Suresh
机构
[1] Columbia Univ, Sch Business, New York, NY 10027 USA
[2] London Business Sch, London NW1 4SA, England
关键词
D O I
10.1111/j.1540-6261.2007.01238.x
中图分类号
F8 [财政、金融];
学科分类号
0202 ;
摘要
Explicit presence of reorganization in addition to liquidation leads to conflicts of interest between borrowers and lenders. In the first-best outcome, reorganization adds value to both parties via higher debt capacity, lower credit spreads, and improved overall firm value. If control of the ex ante reorganization timing and the ex post decision to liquidate is given to borrowers, most of the benefits are appropriated by borrowers ex post. Lenders can restore the first-best outcome by seizing this control or by the ex post transfer of control rights. Reorganization is more likely and liquidation is less likely relative to the benchmark case with liquidation only.
引用
收藏
页码:1341 / 1377
页数:37
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