Well executed Investments in distressed debt can generate massive Returns.
You might wonder why somebody, would want to invest in a Company with a high likelihood of defaulting. The answer is simple: The more risk you take on, the more reward you can potentially make. Every debt can be negotiated and everybody knows, it is better to get 10% or 30 % than nothing. The same is with lawsuits: How many lawsuits have produced Zero returns. Plenty. So there is always a walk-away premium.
But my take is that what goes on here is not about a buy-out but rather a restructuring and this of course would then involve Money that loves distressed debts so as to clean the Balance sheet. Inject Money to go ahead with a new Business plan and a stricter admin control and executive control. The start with such games always goes over control of the Shares and to me it seems, this is exactly what is going on.
But as always, It is my opinion and I could be wrong.
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