If they go Chapter 11, we could be saved by one scenario, if it is a prepackage where the common get even 5 or 10% of the recapitalized company. I know that doesn't sound like much but think of where this company was just a few months ago. That would create an incredible short covering rally to at least 5 or 6 IMHO. Of course, this might be unlikely, but still possible.
Agreed. Even if the fleet is valuated $1B less than the book there is still $0,5B equity left. It may be hard to bypass the shareholders completely in a prepacked BK scenario. The shareowners are mainly institutions and their lawyers seem rather active in protecting shareholders rights.
About 5%-20% stake in the new OSG seems very possible indeed..