Research Recap submits:

Convincing debt holders to swap holdings that are in danger of default for bonds of lesser value has become an increasingly attractive option for some hard-pressed companies. “As long as capital markets remain open, we believe that some issuers will consider this option,” according to Diane Vazza, managing director of Standard & Poor’s Global Fixed Income Research Group.

“Yet, it’s important to understand that, after a distressed debt exchange, many companies won’t necessarily present a stronger credit profile.,” she wrote in a Q&A on the speculative grade sector.

Complete Story »