Recapitalization
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A graduate of the University of California Santa Barbara, Jim Knell is a real estate executive with decades of experience in the field. As the chairman of the SIMA umbrella of companies, Jim Knell has orchestrated over 30 recapitalizations.
Recapitalization is generally defined as a tool used by corporations to restructure assets, particularly the mix of debt and equity. The goal of recapitalization is usually to improve a firm’s overall financial stability, and the process often involves negotiating and exchanging financing mechanisms.
A company may recapitalize for a number of reasons, such as to improve liquidity, allow an exit for venture capitalists, or to improve the tax position of a firm. In addition, various recapitalization strategies can be implemented. One example of a strategy is swapping debt for equity by issuing stock to buy back corporate shares, thereby lowering the tax liability of a firm, since debt interest payments are tax deductible. Another strategy is to shift the overall balance of debt and equity by issuing stock to fund dividends.
James Knell (Santa Barbara) 