Coronavirus Bankruptcies Are Coming

Coronavirus Bankruptcies Are Coming

Experts foresee so many filings in the coming months that the courts could struggle to salvage the businesses that are worth saving.. More than 6,800 companies filed for Chapter 11 bankruptcy protection last year, and this year will almost have more.. If a company goes into bankruptcy with more secured debts than the value of its assets, the secured creditors - including vulture investors who bought up the debt for a song - can walk away with virtually everything.. Mr. Altman expects at least 66 cases with more than $1 billion in debt this year, eclipsing 2009's mark of 49.. Robert J. Keach, a director of the American College of Bankruptcy, said many companies had so far managed to put off bankruptcy by amassing cash and conserving it as best they can: drawing down existing credit lines, furloughing workers, delaying projects and taking advantage of federal and state pandemic-relief programs.. The loans can be converted to grants if the companies meet certain requirements, and if the borrowers can put off bankruptcy until they're sure they won't have to pay the money back, they will have more cash when they file.. That, Mr. Gerber said, makes it imperative that the bankruptcy