| Form of studies |
Professional Master |
| Title of the study programm |
Business Administration |
| Title in original language |
Restrukturizācijas stratēģijas izmantojot aktīvu pārdošanu |
| Title in English |
Distressed Sale of Business Assets as a Corporate Restructuring Strategy |
| Department |
01B00 Riga Business School |
| Scientific advisor |
R.Lucijanovs |
| Reviewer |
J.Praņēvičs |
| Abstract |
This master thesis will analyze the opportunity for companies to divest their assets as one of the restructuring strategies. Asset divestment is one instrument of the various restructuring techniques that can be used by companies. The purpose of the Master thesis is to develop a model for evaluating distressed asset sales as potential restructuring opportunity for companies.
Following problem statement has been defined: Not fully utilized companies facing assets that provide sufficient cash flow and companies requiring financing to support their operations should consider option of distressed asset sale as restructuring option to maintain their operations.
The thesis will focus on specific circumstances under which asset sale should or should not be performed. The research is focused on the process and development of the general model that can be applied to broad data sample rather than specific industries or companies. Following scope and limitations are defined: First, research focus will be limited to one particular area of restructuring - asset sale and other forms restructuring will be excluded from analysis. Second, research focus will be limited only to fixed and physical assets owned by the firm. Third, research focus will be limited to assets that are pledged against a loan. Forth, research focus will be limited to companies with poor financial performance. Fifth, research focus will be limited only to voluntary asset sales. Sixth, research focus research focus has been done taking into account that all activities are based in Latvia following its legislative and administrative infrastructure. Seventh, research was performed from December 2011 April 2012.
To address the stated problem, following steps have been performed: (i) review of the restructuring and asset divestment related theory; (ii) analysis and description of the external environment in Latvia and key economic indicators; (iii) analysis of the credit loan portfolio to companies of Latvian commercial banks; (iv) development of the model that enable companies and its executives to assess the suitability of the distressed asset sale as potential restructuring strategy; (v) Implementation of the model and case analysis of the Company X where model has been applied and tested under based on the data of the Company X.
Thesis consists of seven chapters. First chapter contains definition of purpose of the thesis, problem statement, scope and limitation of the thesis, research methods and structure of the thesis. Second chapter contains glossary of term and abbreviations. Third chapter provide overview of theoretical aspects of the concept of restructuring, concept of asset divestment, indicators of asset divestment as well as options of debt restructuring. Forth chapter describe and analyze the external environment by reviewing the key economic indicators of the Latvias economy and loan portfolio of the commercial banks. Fifth Chapter provides analysis and construction of a model that can be used for evaluation procedures for companies that are exploring asset divestitures. Sixth chapter test and analyzes the proposed model with real case analysis of the Company X. Seventh chapter summarizes the conclusions of analysis and conclude thesis. |
| Keywords |
Distressed asset sale, Restructuring, |
| Keywords in English |
Aktivu pardosana ar diskontu, Restrukturizācija, |
| Language |
eng |
| Year |
2012 |
| Date and time of uploading |
07.05.2012 16:07:05 |
