HL Restructuring Case Study Question
Went through Houlihan Lokey's case study and one of the more pressing questions I had was why didn't HL and RuffCo Golf go for a Chapter 11 Section 363 asset sale right at the beginning (instead of the out-of-court sale that they went for)? It seems like the public auction aspect of Chapter 11 would allow RuffCo Golf to get a higher price (which it did in the case study). The only thing I can think of as to why they didn't is that Ch 11 proceedings would take longer and it was possible the company's liquidity couldn't support that duration of time. Is there anything else I'm missing? Any insight would be appreciated.
It's been a while since I read the case. I think with public auction it might cause further harm to supplier/consumer relations that is more net harmful than competitive process (they already knew there wasn't much interest in the business).
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