Debt overhang
id:
debt-overhang-319-7972077
title:
Debt overhang
text:
Debt overhang is the condition of an organization that has existing debt so great that it cannot easily borrow more money, even when that new borrowing is actually a good investment that would more than pay for itself. This problem emerges, for example, if a company has a new investment project with positive net present value (NPV), but cannot capture the investment opportunity due to an existing debt position, i.e., the face value of the existing debt is bigger than the expected payoff. Hence,
brand slug:
wiki
category slug:
encyclopedia
description:
Debt so large that even positive investments go to debtholders
original url:
https://en.wikipedia.org/wiki/Debt_overhang
date created:
date modified:
2024-01-23T07:49:38Z
main entity:
{"identifier":"Q5248608","url":"https://www.wikidata.org/entity/Q5248608"}
image:
fields total:
13
integrity:
14