RX: Different Types of Models

Not to take over the thread, but have you ever considered jumping to the RX IB side of things? Currently an A1 in RX at one of the firms you mentioned above.

Former PJTRSSG / HLRx analyst here. Can confirm that happens Rx consultant are not involved in situation unless a 3rd party valuation is needed and 13w is handled by Debtor’s FA

It's rarer, but will happen. As others have noted, it would occur on a debtor side mandate if the debtor hasn't engaged an RX consultant. Oftentimes though, the lift from the banker is much less than it would be for the consultant. As a banker you'd be relying on the Company's FP&A or treasury team to put it together and you might diligence the inputs/outputs. Bankers aren't going to be getting a dump of cash transactions and then expected to figure out a TWCF

LMD

13 week CF models definitely handled by the RX consultants; they're the ones doing the actual top line projections etc. 

Off the top of my head: 

• Recap / refi models and debt waterfalls as you've mentioned. Be prepared to run 100 incrementally different scenarios; one of my deals had a couple hundred rows just on the control panel / assumptions page. This also includes models to deal with warrants/options that are sometimes part of the RX consideration
• Liquidity / CF models in the sense that you take the consultants' numbers and run it through your new capital structure / financing assumptions etc.
• Comps and every so often a full blown valuation that, in my opinion, is more rigorous than in M&A given it has to hold up in court
• And once in a blue moon some random esoteric models: I've done a stochastic model, a customer lifetime valuation model, and a particularly fiendish valuation of a bespoke option

Can you share with us the structure of the bespoke option out of curiosity?

Interested in the guide, and thank you very much in advance!

Could you send me a PM? Thank you.

Somehow I couldn't send you a message. Could you PM me instead? Thank you!

Hey silver85 it’s not letting me pm you. Interested in some of the models you have, can you pm me?

Hi Silver, would love some of those models - won't let me PM you though 

pm me please

I’d also be interested if you still have it :)

I wasn't able to PM you, but would love the guides if you're able to share! 

I think this list is fairly comprehensive but would also add that your PF cap structure models can also include showing breakdowns of the different tranches of debt through the various holders.  A big part of out of court restructurings is not only looking at the new cap structure, but also how it's divided between the different negotiating parties and what the value / security level / recoveries for each party look like.