Restructuring & Bankruptcy Math: Recovery Waterfalls, Absolute Priority & Plan Value
Work through a fictional retailer's Chapter 11 case in numbers: liquidation value, the claims stack, an absolute priority waterfall, recoveries by class, deficiency claims, reorganisation value vs liquidation, plan distributions and the fulcrum security, every cell checked as you go. Simplified and educational, not legal or investment advice.
The first lesson is free — no account needed.
About this course
A restructuring and bankruptcy math course that follows one fictional retailer's Chapter 11 case in a spreadsheet, for credit analysts, distressed-debt students and restructuring candidates. You estimate liquidation value from recovery rates by asset class in a low and a high case, build the claims stack from secured debt to equity in order of seniority, pour a sale price down the stack with an absolute priority waterfall using MIN(claim, remaining), turn distributions into recovery percentages and pro-rata shares inside a class, split undersecured lenders' claims into a secured part and a deficiency claim, compare reorganisation value from EBITDA × multiple with liquidation, hand out new debt and new equity under a plan and find the fulcrum security and who owns the reorganised company. Simplified and educational, not legal or investment advice. The first lab is free.
Lessons
- Liquidation Value: Recovery Rates by Asset ClassFree
- The Claims Stack: Secured, Admin, Priority, Unsecured & Equity Pro
- The Absolute Priority Waterfall with MIN(claim, remaining) Pro
- Recovery % per Class & Pro-Rata Sharing Inside a Class Pro
- Collateral Coverage & Deficiency Claims for Undersecured Lenders Pro
- Reorganisation Value (EBITDA × Multiple) vs Liquidation Pro
- Plan Distribution: New Debt, New Equity & Implied Recoveries Pro
- The Fulcrum Security & Debt-for-Equity Ownership Pro