France Telecom: The 2002 Financial Distress Case Solution
Abstract:
It provides the details required to comprehend the modifications in FEET's company environment, how management reacted, what wake-up calls FEET gotten from the CRAs, how FEET's property quality developed, what concealed forces impacted its relocations, what off-balance sheet liabilities it sustained and how its funding characteristics worked.
The case enables the trainee to draw conclusions as to why and how FEET's reliability broke down, dragging credit reliability down in its fall.
Pedagogical Objectives:
The case is extremely flexible and the instructor can pursue any or all the following goals, throughout 2 to 3 classes: -How to do credit score analysis and reach a credit score action; -How to develop and tactically execute financial policy in the light of the characteristics of business, competitive and securities markets cycles; -How to prepare for financial distress, the best ways to see and determine it, ways to leave it; -How to determine, evaluate and handle financial versatility; -How to use structural Merton type designs to draw out default possibilities from market value (a C program can be provided to calculate implied possession volatility, property assessment and default likelihood); -How to evaluate the course to economic distress by using put-call based appraisal of the brief put of the financial obligation.
This is just an excerpt. This case is about Economics & Finance
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