Valuation

Valuation disputes are a critical tool for junior creditors in chapter 11 cases, but their effectiveness depends on strategic timing and approach. This panel will examine key moments where valuation issues arise, including DIP/priming fights, adequate protection and financings with equity rights. Topics will include timing considerations such as access to valuation data, the impact of ongoing sale processes, and cost-benefit analyses. The panelists also will provide insights into how junior creditors can tactically engage in valuation disputes to protect their interests while navigating the complexities of large chapter 11 cases.

Financial projections often reflect the intent behind their creation, whether for sell-side transactions, buy-side due diligence, bank credit assessments, operational budgets or chapter 11 exit plans. This session will explore how these purposes impact the reasonableness of projections, including the potential for bias and the role of divergent stakeholder perspectives. Insights from company management, investment bankers, private-equity sponsors, creditor advisors, litigation experts and judges will shed light on best practices for evaluating the reliability and objectivity of projections in valuation and solvency analyses.

Despite the potential need to reassess liability management exercise (LME) structuring following the Fifth Circuit’s Serta decision, LMEs will continue to proliferate. Questions remain, though: Should we view LMEs as nothing more than free options for sponsors and a rearranging of deck chairs on a sinking ship? Or can they be a force for good, leading to improved enterprise value and corresponding improved returns to all creditors? If so, how can companies maximize the chances of their LME doing so? This panel will address these questions and more.

Technological disruption. Geopolitical forces. Counteracting supply-and-demand shifts. Volatile markets. Zero-carbon-generation portfolios. This session will explore the intersection of climate policy, energy policy, AI and other load growth factors, the fickle winds of U.S. and global government mandates/subsidies, and the impact on deal pricing, structure, post-closing viability and funding. The panelists also will provide a forward look at restructuring trends and investment opportunities.

Valuation often hinges on critical company-specific statistical and methodological decisions, raising questions about their necessity or potential for manipulation. This session will examine such topics as mean vs. median, discounts for lack of marketability, premiums for control, and size premiums and company-specific premiums, and will offer insights into how these decisions shape valuation outcomes.

Content valuation in the AI era presents unique challenges, as disputes over unauthorized use, such as those raised by The New York Times, highlight the need for innovative solutions. Stakeholders are increasingly turning to settlement and licensing frameworks that retroactively and prospectively value content. This session will address methodologies like the relief-from-royalty and venture capital methods, tackling complex issues of ownership, collateralization and growth projections with practical examples to illuminate these emerging dynamics.