Reputation and the market for distressed-firm debt
Our analysis explains how vulture investors (vultures) can maintain and exploit their rep- utations for toughness. Vultures leverage their reputations to extract concessions from stockholders in debt restructurings. To profit from these concessions, vultures must first acquire debt from incumbent bo...
| Main Authors: | , |
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| Format: | Journal article |
| Published: |
2003
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| _version_ | 1797091908095311872 |
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| author | Noe, T Rebello, M |
| author_facet | Noe, T Rebello, M |
| author_sort | Noe, T |
| collection | OXFORD |
| description | Our analysis explains how vulture investors (vultures) can maintain and exploit their rep- utations for toughness. Vultures leverage their reputations to extract concessions from stockholders in debt restructurings. To profit from these concessions, vultures must first acquire debt from incumbent bondholders. Buying only the tranches most likely to render them marginal creditors maximizes vulture leverage in debt-purchase negotiations. Vulture profits are proportional to the degree of uncertainty regarding the identity of the marginal debt class |
| first_indexed | 2024-03-07T03:39:06Z |
| format | Journal article |
| id | oxford-uuid:bd45bc2a-e008-4e99-bdbb-e0d9a993713a |
| institution | University of Oxford |
| last_indexed | 2024-03-07T03:39:06Z |
| publishDate | 2003 |
| record_format | dspace |
| spelling | oxford-uuid:bd45bc2a-e008-4e99-bdbb-e0d9a993713a2022-03-27T05:30:32ZReputation and the market for distressed-firm debtJournal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:bd45bc2a-e008-4e99-bdbb-e0d9a993713aSaïd Business School - Eureka2003Noe, TRebello, MOur analysis explains how vulture investors (vultures) can maintain and exploit their rep- utations for toughness. Vultures leverage their reputations to extract concessions from stockholders in debt restructurings. To profit from these concessions, vultures must first acquire debt from incumbent bondholders. Buying only the tranches most likely to render them marginal creditors maximizes vulture leverage in debt-purchase negotiations. Vulture profits are proportional to the degree of uncertainty regarding the identity of the marginal debt class |
| spellingShingle | Noe, T Rebello, M Reputation and the market for distressed-firm debt |
| title | Reputation and the market for distressed-firm debt |
| title_full | Reputation and the market for distressed-firm debt |
| title_fullStr | Reputation and the market for distressed-firm debt |
| title_full_unstemmed | Reputation and the market for distressed-firm debt |
| title_short | Reputation and the market for distressed-firm debt |
| title_sort | reputation and the market for distressed firm debt |
| work_keys_str_mv | AT noet reputationandthemarketfordistressedfirmdebt AT rebellom reputationandthemarketfordistressedfirmdebt |