Davis Polk partner and Restructuring practice co-head Damian Schaible was quoted in Turnarounds & Workouts on recent trends in restructuring. Damian noted, “2021 brought an interesting mix of COVID-era restructurings, largely continued from last year and earlier, and post-COVID transactions borne of the incredibly hot market we’ve found ourselves in.” Those hot markets mixed with “historically astonishing amounts of capital being raised and ready to be put to work, and very loose financing documents meant many traditional equitization restructurings were avoided with capital infusions, liability management and amend-and-extend transactions.”

Looking forward, Damian is paying attention to “what, if anything, Congress does with the recent noise around third-party releases coming out of the Purdue and Boy Scouts cases. The reality is third-party releases are a necessary component of many of the toughest restructurings, and the Bankruptcy Code provides a very defined set of rules that limit and provide for court supervision over releases.”

In closing, Damian discussed the significance of the Purdue Pharma restructuring – in which Davis Polk represents Purdue –  noting it may be the most complex Chapter 11 case in United States history.

“Restructuring Pros Reflect on 2021,” Turnarounds & Workouts (December 2021) (subscription required)