Struggling Companies That Got Debt Lifelines Are Failing Anyway

Struggling companies like Incora and Envision Healthcare Corp. asked lenders for lifelines, and got them, in contentious transactions that sometimes triggered lawsuits. Then they went bust anyway.

The bankruptcy filings, which came as recently as last week, underscore how floundering companies that seek more money from investors are often only delaying the inevitable. And when they do fail, their final financings might leave everyone worse off.

A study by Fitch of 30 transactions from ailing companies seeking to borrow more, delay maturities, or otherwise manage liabilities found that 24 of these deals either amounted to defaults, or were followed by ...