About six months, I wrote that I saw little hope that severely troubled Mexican homebuilder Homex (HXM)
would be able to pull itself out of a tailspin and salvage meaningful
value. Since then, the shares are down about a third, the company has
effectively ceased new operations, and bondholders and shareholders
alike are wondering when and how the company will be able to restructure
its debts and resume operations.
At the time of the company's
last report, Homex had about $1 per share in book value remaining on the
balance sheet. If Homex goes through a prepackaged bankruptcy similar
to the one recently filed by fellow Mexican homemaker Corporacion Geo,
equity holders may end up with about 10% of the company. That's better
than nothing, and there is still considerable uncertainty about what a
final deal will look like, but investors are looking at long odds for a
happy ending to this story.
Read the full article here:
Can Investors Salvage Value From Homex?
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