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Case | HBS Case Collection | February 2019

Quiksilver Inc. and Oaktree Capital Management

by Kristin Mugford and Mike Harmon

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Abstract

Sports lifestyle company Quiksilver filed for bankruptcy in September 2015. Oaktree is considering an additional investment in the company to facilitate the restructuring. Students must consider whether Oaktree should invest given the risks of the turnaround required at Quiksilver. Additionally, students need to craft a restructuring proposal that will be attractive to investors and will succeed in gaining support from the company and other creditors.

Keywords: bankruptcy; bankruptcy reorganization; Acquisition; Restructuring; Debt Securities; Transformation; Decision Making; Borrowing and Debt; Investment Return; Crisis Management; Negotiation; Retail Industry; Apparel and Accessories Industry; Consumer Products Industry; France; United States;

Language: English Format: Print 18 pages EducatorsPurchase

Citation:

Mugford, Kristin, and Mike Harmon. "Quiksilver Inc. and Oaktree Capital Management." Harvard Business School Case 219-097, February 2019.

Related Work

  1. Supplement | HBS Case Collection | March 2019

    Quiksilver Inc. and Oaktree Capital Management

    Kristin Mugford and Mike Harmon

    Citation:

    Mugford, Kristin, and Mike Harmon. "Quiksilver Inc. and Oaktree Capital Management." Harvard Business School Spreadsheet Supplement 219-733, March 2019.  View Details
    CiteView DetailsPurchase Related

About the Author

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Kristin Williams Mugford
Senior Lecturer of Business Administration
Finance

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More from the Author

  • Case | HBS Case Collection | April 2019 (Revised November 2019)

    Sears: The Demise of an American Icon

    Kristin Mugford and Sarah L. Abbott

    In 2019, ESL Investments’ $5.2 billion offer to purchase Sears Holdings out of Chapter 11 bankruptcy, was accepted, despite opposition from the company's unsecured creditors and other parties. ESL, which was led by Eddie Lampert, had acquired a stake in Sears following its 2005 merger with. Kmart. Lampert was chairman and CEO. During Lampert’s ownership, Sears and Kmart shrunk their store base from 5,670 to 687 stores, and over 200,000 employees lost their jobs. Some attributed Sears’ woes to a challenging operating environment, others argued that Lampert's actions over the last decade benefitted himself and other shareholders at the expense of other Sears stakeholders. Was a sale of the company to ESL the best outcome?

    Keywords: bankruptcy; reorganization; Bonds; Restructuring; Business Divisions; Transformation; Fairness; Borrowing and Debt; Credit; Insolvency and Bankruptcy; Corporate Governance; Motivation and Incentives; Retail Industry; United States;

    Citation:

    Mugford, Kristin, and Sarah L. Abbott. "Sears: The Demise of an American Icon." Harvard Business School Case 219-106, April 2019. (Revised November 2019.)  View Details
    CiteView DetailsEducators Related
  • Case | HBS Case Collection | April 2018 (Revised April 2019)

    Sabine Oil & Gas Corporation

    Stuart C. Gilson, Kristin Mugford and Sarah L. Abbott

    In 2016, a trial began to determine the future of Sabine Oil & Gas Corporation’s $3 billion chapter 11 reorganization plan. The plan called for first- and second-lien-secured creditors to receive new claims representing approximately 98% of the reorganized company’s enterprise value, leaving unsecured creditors, owed $1.4 billion, to recover less than two cents on the dollar. The plan had the support of the secured creditors, but unsecured creditors were strongly opposed. At the heart of the unsecured creditors’ objections to the plan was a dramatically different view on valuation. How much were Sabine's oil and gas reserves worth today? How much were they worth at the time Sabine filed for chapter 11? And, based on these valuations, what was a fair recovery for Sabine's creditors?

    Keywords: corporate reorganization; chapter 11; oil & gas; bankruptcy; bankruptcy reorganization; Insolvency and Bankruptcy; Energy; Restructuring; Valuation; United States;

    Citation:

    Gilson, Stuart C., Kristin Mugford, and Sarah L. Abbott. "Sabine Oil & Gas Corporation." Harvard Business School Case 218-004, April 2018. (Revised April 2019.)  View Details
    CiteView DetailsEducatorsPurchase Related
  • Case | HBS Case Collection | February 2019 (Revised March 2019)

    Scandal at Steinhoff

    Kristin Mugford and Phil Caruso

    Keywords: Volatility; Borrowing and Debt; Insolvency and Bankruptcy; Financial Liquidity; Bonds; Corporate Accountability; Failure; International Finance; Restructuring; Business Conglomerates; Crime and Corruption; Retail Industry; South Africa; Austria; Netherlands;

    Citation:

    Mugford, Kristin, and Phil Caruso. "Scandal at Steinhoff." Harvard Business School Case 219-098, February 2019. (Revised March 2019.)  View Details
    CiteView DetailsEducators Related
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