Business Commons^™

External Administration In Corporate Insolvency And Reorganisation: The Insider Alternative, Larelle Chapple, James Routledge

James Routledge

This article considers the merits of alternative policy approaches to management of companies in insolvency administration, in particular from an identity economics theoretical perspective. The use of this perspective provides a novel assessment of the policy alternatives for insolvency administration, which can be characterised as either following the more flexible United States Chapter 11-style debtor-in-possession arrangement, or relying on the appointment of an external administrator or trustee to manage the insolvent company, who automatically displaces incumbent management. This analysis indicates that stigma and reputational damage from automatic removal of managers in voluntary administration leads to “identity loss” and that an …

Falling Knives: Extreme Value Investing, Ladd Kochman, James Tompkins

Ladd Kochman

We identified 979 stocks with year-ending losses of 60 percent or more during the 1993-2002 period. Post-fall returns extended our analysis through 2005. Unlike previous research, we screened our "falling knives" for financial strength to promote a greater likelihood of recovery and minimize any survivorship bias. When we added the constraint of Altman Z-Scores > 3.0, our data set shrank to 790 stocks and produced two-year and three-year average annual returns that tripled their market counterparts.

An Analysis Of Delta's Oil Refinery Acquisition, Wilfred Manuela, Dawna Rhoades, Tamilla Curtis

Dr. Tamilla Curtis