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It is rather hard to ride a tsunami


HERE COMES THE BANKRUPTCY WAVE!

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Not only is the credit crisis forcing more companies into bankruptcy, it's making it harder for them to climb out of it.

Troubled businesses that in years past might have been able to restructure are increasingly being forced to liquidate, because skittish lenders are pushing for fire sales to recoup what they're owed as soon as possible.

Changes made to the bankruptcy laws three years ago have also accelerated the bankruptcy process, putting pressure on debtors to wind down if they don't immediately turn out a viable restructuring plan.

Meanwhile, the dreary credit markets are making it tougher for borrowers on the skids to line up what is called debtor-in-possession financing, or credit lines used to finance a business through the bankruptcy process.


Last edited by numan; 11/04/08 01:15 AM.