Investing in Financially Distressed Firms: A Guide to Pre- And Post-Bankruptcy Opportunities

A study of the impact of the 1978 Bankruptcy Reform Act on firms that file under chapter 11 and on investors who own shares or bonds in financially distressed corporations. The authors explain how to spot potential investment targets, assess risk, and profit from investing in such firms. The legal issues involved in investing in bankrupt firms, the environment within which the bankrupt firm operates and the relationship between stock market efficiency and bankrupt firms also receive thorough coverage. The authors also describe the reasons for corporate financial failure, the effects of reorganization on a firm, the differences between old and new bankruptcy laws and the legal settlement of bankruptcy claims.