Article Daily Bankruptcy Review

A Look Back and a Look Ahead: Relax, Rest and Get Ready


The year 2004 in restructuring was about oil, steel, airlines, auto and a frothy refinancing market that showed few signs of abating. Many companies managed to stay out of not only Chapter 11 but also any restructuring–­at least temporarily­­–as they benefited from the low interest rate environment and the refinancing market. Last but not least, and defying all expectations, the year ended with a bang–unprecedented in terms of size, political ramifications and cross-border jurisdictional complexity.

For 2005, the Fed seems to be committed to the task of raising interest rates. Companies in industries including airlines, telecom, auto and energy will remain particularly vulnerable. In 2005, especially the early part, rest, relax, and get ready for the next cycle, be it late in 2005 or even perhaps not until 2006. 

Please refer to the December 29, 2004 edition of Dow Jones Daily Bankruptcy Review to read the full text of the article.