I’m Thinking Structural Subordination

Wendy’s/Arby’s Group, Inc. (ticker WEN) was formed in September 2008 through the merger of the Wendy’s and Arby’s fast food chains. In March 2009, WEN announced it had redone its main loan agreement to reflect the merger. Nothing unusual there....

How to Package A Bankruptcy

Why does a company go bankrupt? We often point to factors such as the economy, high leverage, bad management, falling asset values, or strong competition. While all of these can be contributing factors, ultimately a company will file a bankruptcy petition when it...

Confidence Sensitive Cash Flows: Watch the Trade

The 2007 year-end selling season was not good for the home furnishings retailer “Linens ‘n Things.” Quarterly sales were up 0.6%, but only because the company opened four new stores. Ignoring the new stores, same store sales were down 1.0% for the...