Distressed-Debt Exchanges Drive Rise in Defaults, Says S&P

Distressed-debt exchanges led to a rise in global corporate defaults in September and are at the highest year-to-date levels since 2009, according to a report published on Friday by S&P Global Inc.

• There were 11 defaults in September, of which 55% were distressed exchanges
• Distressed-debt exchanges appeal to issuers that view out-of-court restructurings more favorably than other options such as traditional bankruptcy, according to the S&P report
  • Asset value preservation and time and cost savings are big incentives to opt for an out-of-court restructuring
• The global corporate default total for this year stood at 118 at the end of last ...