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We all know that companies in distress tend to have a harder time meeting their financial obligations, which translates to a higher probability that they will default. A company in this position has pretty straightforward options: either raise enough cash through asset sales, operating improvements, and new financing, or reduce or postpone interest and principal payments on the debt by negotiating with creditors.  

For restructuring or turnaround experts, identifying distressed companies is the first hurdle to deal sourcing and business development. Using the AdvantageData workstation, we’ve compiled a list of distressed loans that you might want to be aware of.

Restructuring is often driven by market rhythms, or quantifiable circumstances like the decline of shopping at brick-and-mortar stores in favor of online shopping. An easy example of the latter is the rise in eCommerce at online stores like Amazon, resulting in the bankruptcy and liquidation of Toys R Us. Another, less common circumstance can be natural (or unnatural) disasters.

It has been reported that Pacific Gas & Electric (PG&E), a California based utility, has brought in law firm Weil Gotshal & Manges LLP to explore restructuring options after California officials found the company responsible for the deadliest wildfires in the state’s history in the fall of 2017. One option the firm is said to be exploring is breaking up PG&E and filing bankruptcy for one of the units. For companies struggling financially, sacrificing one area of a business to protect the rest from liabilities is a popular strategy. [source]

Leveraging BDC data has never been easier. Using BDC Advantage by AdvantageData, you can filter aggregated business development company portfolio data by industry, investment type, filing notes and more. 

Generate refined custom data elements that can be downloaded in an easy-to-use excel spreadsheet. We filtered our list by filing notes (selecting the "non-accrual: yes" option) to find out which portfolios were in the most trouble.