‘W
9
Two months later
e are stuck in this MegaBowl deal,’ said Jonathan Husky, vice president and my boss in the
Distressed Debt Group.
My phone buzzed in my pocket. I checked the time. It was 7 in the evening. I had to meet Debu
in an hour. It seemed undoable.
We sat in the meeting room of the Goldman Sachs Distressed Debt Group. From the Goldman
side, there was Jonathan, Clark Smith, who was another associate in the group, and me. We also had a
representative from each of the seven banks that had lent to MegaBowl, a Boston-based builder of
bowling alleys. While people who played in their bowling alleys had fun, their creditors had a
different story. MegaBowl had defaulted on fifty million dollars’ worth of loans.
‘There are no assets,’ Jonathan continued. ‘The company has nothing apart from lots of
bowling pins and bowling balls.’
Recovering fifty million dollars would require a lot of bowling balls, I thought. The bankers
looked at each other in silence, sympathizing with each other for their collective stupidity in lending
so much money to MegaBowl.
‘Tell us what to do,’ one of the bankers said. ‘We just want out. I can’t deal with their stupid
CEO.’
My hand went into my handbag and grabbed my phone.
‘Radhika.’ Jonathan saying my name startled me. ‘Please share the plan.’
Damn, I needed a minute to tell Debu I couldn’t make it tonight. I released my phone and
brought my hand out of my bag.
‘Eh, sure, Jonathan,’ I said. I shared the special booklets I had prepared for the meeting.
‘Our basic premise,’ I said, opening the first page, ‘is to keep MegaBowl as a going concern.
There is little value in liquidation, just about six cents on the dollar. However, it is fifty cents if we
allow the CEO to continue.’
‘Fire him,’ Dirk Grigly, a fat and bald banker from Bank of America, said. ‘He has caused all
the mess.’
‘He has, yes,’ I said, ‘but we need him to stabilize operations for now. We also have to
retrench people and cut salaries. Let’s use him to do the dirty work.’
I walked them through the plan. It would enable the company to reduce its size and reduce
costs.