Bankruptcy News

We've summarized the latest docket activity and news for publicly traded companies currently operating under U.S. Bankruptcy Court protection.

Bankruptcy/Chapter 11 / Media / Retailing

Borders Group Plan Confirmed

The U.S. Bankruptcy Court confirmed Borders Group’s First Amended Joint Chapter 11 Plan of Liquidation. According to the Disclosure Statement, which was approved on November 10, 2011, “The purpose of the Plan is to liquidate, collect and maximize the Cash value of the remaining assets of the Debtors and make distributions in respect of any Allowed Claims against the Debtors’ Estates. The Plan is premised on the satisfaction of Claims through creation of the Liquidating Trust (pursuant to the Liquidating Trust Agreement) and distribution of the proceeds raised from the sale and liquidation of the Debtors’ remaining assets, claims and Causes of Action. On the Effective Date, the Debtors will transfer and assign to the Liquidating Trust substantially all property and assets of the Debtors. While the Debtors, in consultation with the Committee, may designate that certain assets remain with the Debtors, proceeds of those assets will constitute Liquidating Trust assets. Pursuant to the Plan, the Liquidating Trust will pay all Allowed Priority Claims and Administrative Expense Claims in full that have not previously been paid by the Debtors. To the extent there are assets remaining in the Liquidating Trust after payment of all Allowed Priority Claims, Administrative Expense Claims and expenses of the Liquidating Trust, all Holders of Allowed General Unsecured Claims shall receive a Pro Rata Share Distribution of the remaining assets of the Liquidating Trust. The Holders of Intercompany Claims and Equity Interests shall not receive any Distributions from the Liquidating Trust.” This book, movie and music retailer filed for Chapter 11 protection on February 16, 2011, listing $1.4 billion in pre-petition assets.

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Is there value in bankrupt PG&E’s stock?

In nearly every case, the shares of a company in bankruptcy become worthless. In very rare cases, however, they can become great investments. W.R. Grace (NYSE:GRA) shares produced a 75-fold return, as an example. With California utility PG&E (NYSE:PCG) now in bankruptcy, the range of possible outcomes for its equity is wide.

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EV/EBITDA: What Is It & Why Are We Using It More?

In reading recent editions of The Turnaround Letter, you have probably noticed that we are increasingly using EV/EBITDA as a valuation measure, rather than the better-known price/earnings multiple.  We thought it might be useful to describe this measure and why we like it.

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Turnaround Letter Stock Pick Named Top Performer of 2017


stock market advicex


What Last Year's Top Stock Pickers Are Buying in 2018


This Forbes write-up follows up on the recent Top Stock Tips report--naming The Turnaround Letter's Crocs recommendation the top performer of 2017: With 90% gains, CROX beat out 100 other investment ideas included in the report; and the stock continues to have value investing appeal, according to Putnam.


George notes, "We see additional upside for the stock in 2018 as management's efforts continue to bear fruit, though the gains will likely be more muted than we saw in 2017."