Expert Value Is Not Equal to Market Value Under Exception to Absolute Priority Rule
Federal district court reverses bankruptcy court’s confirmation of debtor’s exclusive reorganization plan, finding that expert valuation does not satisfy requirement for actual market valuation under new value exception to absolute priority rule.
Expert’s ‘Hyperbole’ in Article Comes Back to Haunt in Daubert Hearing
Bankruptcy court denies Daubert motion and grants summary judgment based largely on expert insolvency analysis, despite “professional” disagreement on data used to calculate small stock premium, cost of debt, and company-specific risk premium.
Valuing Two Tough Aspects of Damages: Pricing and Discount Rate
Bankruptcy court finds that the discount rate related to a contract damages claim should incorporate the risk factors present at the time of contract execution, making risk-free rate inappropriate.
‘Most Reliable, Least Speculative’ Valuation Prevails in Bankruptcy
Federal district court affirms bankruptcy court’s solvency and “reasonably equivalent value” analysis based on more credible, substantive evidence from debtor’s expert.
In re Terrestar Networks, Inc.
Bankruptcy court holds that a security interest may exist in the economic value of an FCC license, despite federal law precluding the granting of a collateral interest in the license itself.
In re Village at Camp Bowie I, L.P.
Bankruptcy court finds “cramdown” interest rate equals at least 6.4%, based on current commercial lending “realities” as well as expert’s application of debtor-specific risk factors, including benefits of bankruptcy and single lender.
Nelson v. Walnut Investment Partners
Bankruptcy court denies Daubert motion and grants summary judgment based largely on expert insolvency analysis, despite “professional” disagreement on data used to calculate small stock premium, cost of debt, and company-specific risk premium.
Six Valuation Experts Try to Show Barclays Reaped a Windfall in Lehman Sale
Bankruptcy court denies Lehman Brother’s motion to reconsider billion-dollar distressed sale of brokerage assets during financial meltdown of September 2008, based in part on expert evidence that showed Barclays did not receive a $13 billion “windfall.”
H.G. Roebuck & Son, Inc. v. Alter Communications
Federal district court reverses bankruptcy court’s confirmation of debtor’s exclusive reorganization plan, finding that expert valuation does not satisfy requirement for actual market valuation under new value exception to absolute priority rule.
3rd Circuit Confirms DCF to Value Mortgage Portfolios in Dysfunctional Markets
In issue of first impression, 3rd Circuit confirms that the term “commercially reasonable determinant of value” as used in Sec. 562 of the Bankruptcy Code includes the discounted cash flow methodology, particularly when markets are dysfunctional.
Management Projections, DCF Discount Rate, and More Are Key to Bankruptcy Valuation
Bankruptcy court finds billion-dollar total enterprise valuation of flash memory manufacturer supports finding that proposed reorganization plan is fair but declines confirmation pending amendments to equity incentives for management.
Should Neutral Appraiser Be Kept ‘Blind’ to Parties’ Competing Valuations?
Court denies debtors’ request for “appraisal protocol” concerning its purchase of certain limited partnership interests, including a demand that the independent appraiser be kept from learning about the parties’ prior competing valuations.
In re Chemtura Corp. (II)
Bankruptcy court finds that the discount rate related to a contract damages claim should incorporate the risk factors present at the time of contract execution, making risk-free rate inappropriate.
In re Global Technovations, Inc. (II)
Federal district court affirms bankruptcy court’s solvency and “reasonably equivalent value” analysis based on more credible, substantive evidence from debtor’s expert.
Bankruptcy Expert Claims DCF Indicates Market Value Better Than the Market
Court authorizes $1.1 billion asset sale of the debtors, despite DCF by lenders’ expert that shows $13.8 billion value.
Valuing Director Guaranties in Bankruptcy: Using a Put Option Approach
Bankruptcy court confirms reorganization plan based in large part on “put option” approach to valuing corporate insider guaranties.
In re Lehman Bros. Holdings Inc.
Bankruptcy court denies Lehman Brother’s motion to reconsider billion-dollar distressed sale of brokerage assets during financial meltdown of September 2008, based in part on expert evidence that showed Barclays did not receive a $13 billion “windfall.”
In re American Home Mortgage Holdings, Inc. (II)
In issue of first impression, Third Circuit confirms that the term “commercially reasonable determinant of value” as used in Sec. 562 of the Bankruptcy Code includes the discounted cash flow methodology, particularly when markets are dysfunctional.