企业重组【外文翻译】

外文翻译Corporate RestructuringMaterial Source: Author:Giuliano Iannotta The Holdout ProblemWhen claimants are unable to find an agreement, they might not approve the restructuring plan, even when this will produce a sub-optimal outcome, such as a liquidation (which will waste the value of the firm “as a going concern”) or a formal bankruptcy procedure (which is more expensive and possibly leads to inferior result for creditors): this is the holdout problem. The likelihood of approval of the restructuring plan will depend on several factors, such as the number and sophistication of the claimants, the relative cost of the plan relative to other solutions, etc.For example, in the presence of many small bondholders it might be very difficult to get the restructuring plan approved, as some of them might believe they will be better off not approving the proposed plan. In other terms, when there is public debt (i.e., bonds) outstanding the holdout problem can be particularly severe. Scale down, maturity extension, or debt-for-equity swap might be very difficult if every bondholder has to agree to the term changes. Consider for example an exchange offer where outstanding debt is exchanged with equity (debt-for-equity swap): in other words, creditors take over the distressed firm. In such a situation, the bondholders who do not tender might benefit at the expense of those who do. Suppose the firm’s asset value is $100, with public debt outstanding for$120 (10 bondholders, each holding one bond with face value $12). The firm’s asset liquidation value is only$80: there is therefore an incentive to keep the firm doing business. Suppose the exchange offer is contingent on achieving a 50% tendering rate. If all bondholders tender, the firm will have the balance sheet reported in Table 10.1.The value to each bondholder will be $10, with a loss of $2: under liquidation each bondholders would receive just $8. Now suppose that only five bondholders tender: the exchange offer would succeed, but the five “holdout” bondholders will be better off. Indeed, the balance sheet of the firm would be that reported in Table 10.2.The five holdout bondholders will still have one bond each, with face value $12: in contrast the five tendering bondholders would each receive equity worth $8, which corresponds to the liquidation value. Of course, rational bondholders will anticipate this outcome, and none of them will tender. The exchange offer will fail, unless the bondholders are able to coordinate. The success of the exchange offer also depends on the difference between the firm value “as a going concern” and under liquidation. As we will see in the next section, things can become even more complex when other classes of creditors are involved.Private and Public DebtA benefit of borrowing from banks is that private debt is much easier to restructure in financial distress than public debt. Indeed banks are sophisticated and (normally) fewer than bondholders. However, since bank lenders are usually secured, they have little incentive to make concessions when a firm also has unsecured public debt outstanding. Banks are generally limited in their stockholdings in non-financial firms, with a remarkable exception in case of financial distress (in many jurisdictions). Whether a bank will decide to take an equity position in a financially distressed firm, will depend on several variables: again the cost of restructuring relative to liquidation, but also the amount of public debt and the bondholders willingness to restructure their claims. To understand how the financing mix might affect the outcome of the restructuring process consider a very simple model.2 Fig. 10.2 A model of distress resolutionAt time 0 a firm is in financial distress as debt outstanding (D=120) is larger than both the liquidation value (K= 80) and the value as going concern (M=100). Liquidation is not necessarily the optimal solution as the value “as a going concern” is higher than liquidation: let’s call this difference “growth potential”. Now suppose that management/shareholders propose to restructure debt by extending the maturity to time 1. The firm can undertake two alternative projects: (a) a safe project that will produce a cash flow equal to 100 without uncertainty and (b) a risky project which might result in 300 or 0 with equal probability. Note that the risky project is not inefficient as the expected value is 150 (with risk), while the expected cash flow of the safe project is only 100 with no risk. Figure 10.2 provide the time structure of the model.Without specifying the composition of debt it is clear that creditors will force liquidation, losing the growth potential. Indeed, if they accept the maturity extension, managers/shareholders will opt for the risky project, which in turn is suboptimal tocreditors. Table 10.3, reports the payoff to creditors and shareholders under the two projects.If creditors accept to restructure the debt by extending the maturity, managers/shareholders can keep running the firm: if they choose the safe project, the payoff tocreditors will be $100 (more than liquidation), while shareholders will receive nothing. In contrast, if the risky project is undertaken, the expected payoff to creditors is only $60 (less than liquidation) while sh areholders’ expected payoff is $90. It is therefore rational for shareholders to choose the risky project: creditors will anticipate the shareholders’ incentive, thus rejecting the restructuring proposal and forcing liquidation. It is an under-investment problem, as the firm is liquidated even if keeping it on business would generate more value. The real-life intuition is simple: creditors do not accept changes in terms, as they believe that managers/ shareholders will go “for broke” since they have “nothing to loose”.An alternative to liquidation is the use of some sort of “equity kicker” (e.g., convertible bonds or warrants) which align the incentive of shareholders with that of creditors. For example, suppose that creditors are offered 60% of the equity payoff (cash flow less debt) in addition to their credit. Under this agreement, creditors would get $114 with the risky project (versus $100 with the safe project): depending on their risk appetite they might prefer the risky project as the shareholders do. Table 10.4 reports the payoffs with an equity kicker.Suppose that creditors are not willing to accept any equity kicker because the risky project is inefficient.For example, the risky project would be clearly inefficient if the resulting cash flow could be either $140 or $0 with equal probability. Table 10.5shows the payoff to shareholders and creditors under this assumption.Even with a 100% equity kicker (i.e., creditors get 100% of the equity payoff) creditors would still prefer the safe project. Since shareholders would opt for the risky one, creditors would force liquidation. Alternatively, creditors might consider to take over the firm (i.e., accepting a debt-for-equity swap), in which case they could undertake the safe project realizing the growth potential. That would be the outcome if the debt structure is composed by a single non-naı¨ve lender (i.e., a bank or a group of banks). Also, if the whole debt outstanding is public (i.e. bonds) the debt-for-equity swap would be a feasible outcome, provided the holdout problem is resolved (an investment bank might help, as we will see in the next section). However, things are more complex when the debt composition is mixed.If DB < K, then the bank will accept equity only if M – DP > DB, i.e., M > D.But in this case external finance would be feasible, thus violating the definition of distress. Only if public debt holders scale down their claims too, the bank will accept the offer. If it is impossible to restructure the public debt (due to the holdout problem), the bank will never accept equity in exchange for its unimpaired secured claim. Consider a numerical example: suppose DB=30, DP=90, and K=80. The bank debt is unimpaired (DB=30<K=80). The bank could get paid its money by forcing liquidation and would accept equity only if it can get more than 30. If the bank accepts equity and undertakes the efficient project, it will get 100–90=10<DB=30. There would be a wealth transfer from the bank to the ondholders. The bank will accept equity only if also public debt holders scale own their claims: suppose the bondholders accept to scale down their claims to 60. The bank would hence get 100–60=40 >DB=30. If it is impossible to convince the bondholders, the firm is liquidated.This model tries to explain what happens in the real life. James (1995) empirically investigates which factors affect the likelihood that a bank takes equity in exchange for some concession of principal: he finds that this likelihood increases with the market-to-book-value ratio (which is a proxy of growth potential), with the debt-to-asset ratio, and when public debt holders also accept equity. In contrast the probability that banks accept equity decreases with the weight of public debt to total debt.Conclusion:This chapter has described the main restructuring transactions. Restructuring is usually associated to a condition of financial distress, but is not necessarily so.Indeed, a firm might undertake a restructuring transaction simply to enhance value creation or to prevent a situation of distress. In a distress condition there are mainly two alternatives: either restructuring or liquidation, both of which can be realized either with a formal bankruptcy procedure or with an out-of-Court workout. Workouts are normally less expensive and therefore should be preferred to formal procedures. Nonetheless, it often happens that different claimants of the distressed company cannot find an agreed solution. As a result the only solution is going to Court. The solution of a distressed situation normally involves restructuring the firm’s debt contracts. Investment bank can play an important role in debt restructuring,by coordinating the different claimants and certifying the quality of theproposed restructuring plan. Also the asset side of a firm can be restructured. Beside divestures (i.e., sale of a subsidiary or division), the typical assetrestructuring is a stock break-up. Stock break ups consist in separating a subsidiary or a division from the parent company with the purpose of creating value to the parent’s shareholders by means of enhanced information or better managerial incentives. The extant empirical evidence suggests that stock break ups do create value.译文企业重组资料来源： 作者:詹姆斯兰诺抵抗问题:当申索人无法达成共识，他们可能不批准重组计划,即使这将产生一个最优的结果,如清算(会浪费企业的价值“为赢利”)或者是一个正式的破产程序(这更贵,并可能导致劣质的结果给债权人):这是在抵抗问题。