Mr Cooper Group Inc (COOP)

[lxu0077]

Catz

There is just one issue with your example.

Everything that's considerred a distrubition in a Chapter 11 Plan of Reorganization has been valued, so that the POR could calculate a % between distribution and a claim.

So for cash, it's a no brainer. For stocks in the newCo, there is an IPO price that equals to the estimated value of the new company minus new debt and then divided by total number of shares. If the preferred is assumed by a company like JPM, that's also easy, you could give a face value.

Now in the scenario you decribed below, how do the POR assign a value for "re-floating preferred"? Considerring that it's only going to be a $160 million newCo, and the fave value of total preferred is at 7.5B right now.