Pre-restructuring Capital Structures, Financial Restructurings and Recovery Prospects: Assessment of Their Interdependence

Abstract: The purpose of this thesis is to analyse whether financial restructurings produce improvements in the performances of distressed businesses, and whether pre-restructuring capital structures have any influence on the recovery prospects of the restructured businesses. This work is split into two main sections. The first investigates the existence of these relationships from an empirical and statistical standpoint, while the latter analyses the financial restructuring and bankruptcy of SAS Group. The key findings are that financial restructurings help companies to produce statistically significant performance improvements on a relative basis, and that pre-restructuring capital structures have the potential to influence restructuring outcomes, although the evidence is mixed.