Corporate Bankruptcies Delayed Until Virus Carnage Sorted Out

The Covid-19 pandemic has pushed major consumer brands such as Neiman Marcus, J. Crew, and Gold’s Gym into bankruptcy, but a much larger wave of corporate restructurings is still a ways off.

The reason: unprecedented restrictions combined with government assistance make it hard to predict future demand, determine which businesses might rebound, or accurately attach a value to their assets.

“It’s impossible to value a company right now,” said Christopher Ward, chair of the bankruptcy and financial restructuring practice at Polsinelli PC. “All of your historical projections are based on revenue projections.”

In the meantime, lenders are offering struggling businesses ...