A record 45 companies with more than $1 billion in assets have filed for Chapter 11 bankruptcy since the economic shutdown began in March. The number breaks the previous record of 38 for the same period in 2009 in the depths of the Great Recession.
As of 17 August, 157 companies with liabilities above $50 million have sought Chapter 11 shelter this year.
Oil and gas companies lead the list of busted companies with 33 filings, compared to 14 last year. Chesapeake Energy, Diamond Offshore Drilling, and Whiting Petroleum were among the billion-dollar companies that threw in the towel.
Twenty-four retail businesses with assets greater than $50 million also surrendered to bankruptcy, tripling 2019’s number. Neiman Marcus is among several bankrupt retailers that incurred crushing debt after being taken over by private equity firms.
“We are in the first inning of this bankruptcy cycle,” said CEO Ben Schlafman of New Generation Research. “It will spread far across industries as we get deeper into this crisis. Bankruptcy is a growth industry in America.”
TRENDPOST: Trends are born, they grow, mature, reach old age, and die.
The bankruptcy trend in America, and around the world, has just begun. As the “Greatest Depression” worsens, bankruptcies will spread across industries and segments of the economy.
