The disruptions caused by the coronavirus (COVID-19) have been far-reaching and will continue to affect all industries in the months to come. These effects are only exacerbating what were already weekening corporate foundations. Michael Fielding examines what lenders should anticipate and how they can deal with distressed debt situations during and after the pandemic.
Distressed Debt & the Chief Restructuring Officer – Understanding the Philosophy, Psychology and Politics (Part 1 of 2)
In Part I of this article, Ken Naglewski of Seabiscuit Partners examines classical turnaround theory and practice in relation to the realities of organizational dynamics and the behavioral aspects of the players in a distressed debt situation. The author opines on the necessity of a CRO assessing the political realities of each situation and developing a political style and game plan that has the best chance to be successful in a particular situation. In Part II of this article, the author reinforces the importance of dealing with political realities of distressed debt situations, provides some examples from real situations and potential strategies for dealing with different situations.