As the coronavirus pandemic forces a shutdown of the economy, many good companies facing massive revenue declines will need to avail themselves of bankruptcy. It is critical in today’s Covid-19 world, where bankruptcy courts are inundated with cases, to allow for a streamlined chapter 11 process, according to a WSJ Pro Bankruptcy commentary. During the past 15 months, three companies — FullBeauty Brands Inc., Sungard Availability Services and Sheridan Holding Company I LLC — have confirmed their respective prepackaged chapter 11 plans within 24 hours of commencing a bankruptcy case. These “one-day bankruptcy” cases enabled the companies to fix their capital structures without any impact on vendors, customers, employees or retirees. This process should be codified, as it meets the goals of the Bankruptcy Code, eases the burden on bankruptcy courts, and is a net positive for companies, their employees and other stakeholders. Read more.
*The views expressed in this commentary are from the author/publication cited, are meant for informative purposes only, and are not an official position of ABI.
