haku: @author Wruck, K. H. / yhteensä: 6
viite: 3 / 6
| Tekijä: | Weiss, L. A. Wruck, K. H. |
| Otsikko: | Information problems, conflicts of interest, and asset stripping : Chapter 11's failure in the case of Eastern Airlines. |
| Lehti: | Journal of Financial Economics
1998 : APR , VOL. 48:1, p. 55-97 |
| Asiasana: | TRADE UNIONS AIRCRAFT INDUSTRY BANKRUPTCY FINANCIAL CRISES AGENCIES |
| Kieli: | eng |
| Tiivistelmä: | Eastern Airlines' bankruptcy illustrates the devastating effect on firm value of courtspnsored asset stripping, i.e., the use of creditors' collateral to invest in high-variance negative net present value projects. During its bankruptcy, Eastern's value dropped over 50%. A substantial portion of this value decline occured because an overprotective court insulated Eastern from market forces and allowed value-destroying operations to continue long after it was clear that Eastern should have been shut down. The failure of Eastern's Chapter 11 demonstrates the importance of having a bankruptcy process that protects a distressed firm's assets, not simply from a run by creditors, but also from overly optimistic managers and misguided judges. |
SCIMA