Debt restructuring through equity issues

Kim, Woojin; Ko, Young Kyung; Wang, Shu Feng

doi:10.1016/j.jbankfin.2019.07.002

Cited by 26 publications

(15 citation statements)

References 29 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…On a debt aspect, there is a change in interest rate, maturity debt, and changes in debt to equity ratio to solve their capital structure (Koh et al, 2015). Debt restructuring in emerging markets is mostly focused on recapitalizing assets than financial growth (Kim et al, 2019). Debt restructuring methods are limited to four methods.…”

Section: Debt Restructuring Methodsmentioning

confidence: 99%

Analysis of Debt Restructuring Methods for Negative Equity Firm

Nubli

Viverita

2021

Nusantara Science and Technology Proceedings

View full text Add to dashboard Cite

This paper aims to find the best debt restructuring methods for negative equity firms. This study uses four common debt restructuring methods, i.e. Debt-to-Equity swaps, debt-to-asset swaps, issuing convertible bonds, and repayment agreements. Furthermore, based on each debt structure, we compared their price-to-book ratio and debt-toequity ratio (DER) to find the best possible method for every firm and their industries. The sample for this study is firms listed on the Indonesia Stock Exchange (IDX). The ideal capital structure of the firms is determined by using an iterative algorithm. After finding their ideal capital structure, firms will be treated by debt restructuring to reach their ideal capital structure. Mostly, firms are better performances while using debt to an equity swap and issuing convertible bonds. This condition is proven by increasing their P/BV and their better capital structure by looking at their DER. Furthermore, debt to asset swap is better to use for firms with high DER. Whilst debt repayment agreements do not affect the firm's capital structure and its value.

show abstract

Section: Debt Restructuring Methodsmentioning

confidence: 99%

Analysis of Debt Restructuring Methods for Negative Equity Firm

Nubli

Viverita

2021

Nusantara Science and Technology Proceedings

View full text Add to dashboard Cite

show abstract

“…To determine whether Korean firms are affiliated or not to a chaebol, we use the Korean Fair Trade Commission (KFTC) classification. This is a common practice in the literature (see for instance Black et al, 2015;Hwang and Kim, 2016;Kim et al, 2019). We consider as a chaebol firms, firms that are affiliated to one of the 30 largest business groups as classified by the KFTC.…”

Section: The Tests In Section 4 Require Information Relative To the Amentioning

confidence: 99%

The Korea discount and chaebols

Ducret

Isakov

2020

Pacific-Basin Finance Journal

View full text Add to dashboard Cite

Finance practitioners frequently claim that stocks of Korean firms are undervalued and trade at a discount relative to foreign firms. This phenomenon is commonly called "the Korea discount". It is based on anecdotal evidence comparing either the price-earnings ratios of different market indexes or those of different individual stocks. This paper provides empirical evidence on the existence of such a discount using a large sample of stocks from 28 countries over the period 2002-2016. We find that Korean stocks have significantly lower price-earnings ratios than their global peers. We also investigate the role of large business groups called chaebols, which are often considered to be the main cause of the discount because of their poor corporate governance. Our findings show that it is not the case.

show abstract

“…2. Indeed, there is some evidence that this is more common in the case of emerging markets than the USA; for example, see Kim et al (2019). …”

Section: Notesmentioning

confidence: 99%

Converting debt into equity in private limited companies in Thailand

Reekie

2020

IJLMA

View full text Add to dashboard Cite

Purpose The purpose of this paper is to critically examine the prohibition on debt-to-equity conversions for private limited companies in Thailand, resulting from an interpretation of Section 1119 of the Thai Civil and Commercial Code (TCCC) adopted by academics and the regulator. Design/methodology/approach This paper critically examines the interpretation of Section 1119 of the TCCC made by academics, the Thai Supreme Court and the regulator. Taking an approach, which draws on debate in the EU over the past two decades, this paper presents a new understanding of the rules relating to legal capital in Thailand. This new understanding is applied to challenge the orthodox interpretation of Section 1119. Findings The interpretation proposed by this paper is that debt-to-equity conversions may be permitted when viewed as shares issued in return for payment in kind. This proposed interpretation is consistent with existing Thai Supreme Court jurisprudence. In addition, a close reading of the provision, further supported by a historical investigation into the legislative drafting process, reveals that it reflects the original intention behind this provision. Originality/value This paper presents a view of Thai legal capital rules, which challenges the orthodox understanding of their nature, purpose and categorisation. Furthermore, the proposed interpretation of Section 1119 of the TCCC, if adopted by the regulator, would permit Thai private limited companies to engage in debt-to-equity swaps without further legislative intervention.

show abstract

Debt restructuring through equity issues

Cited by 26 publications

References 29 publications

Analysis of Debt Restructuring Methods for Negative Equity Firm

Analysis of Debt Restructuring Methods for Negative Equity Firm

The Korea discount and chaebols

Converting debt into equity in private limited companies in Thailand

Contact Info

Product

Resources

About