distressed company valuation

Distressed company valuation determines a company's worth when it's financially troubled or nearing insolvency. Unlike regular valuations based on ongoing profits and growth, this approach considers the company's assets, liabilities, and potential for recovery or sale under distressed conditions. Factors like the value of physical assets, market conditions, and possible restructuring are important. Essentially, it estimates what a buyer might pay if the company were to be sold quickly to settle debts, often resulting in a lower value compared to a healthy company, reflecting the higher risks involved.