10 questions reported in Davidson Kempner interviews, organised by the group that asks them. Every question carries a model answer and graded feedback on your own attempt.
Questions
Easy · Medium
Hard
Model builds
Built in the spreadsheet grid
Deal break risk, spread maths, regulatory timelines and downside to unaffected. 5 questions
Event-driven funds test whether candidates can translate enterprise value into class-specific recovery before discussing a distressed catalyst.
A bankrupt company is worth $180m after restructuring costs. It has a $40m revolver, $100m first-lien term loan and $80m unsecured notes. Ignoring interest and fees, calculate each class's recovery…
Funds expect analysts to turn a merger agreement into a concise risk checklist.
Which provisions in a merger agreement would you read first, and why?
A first-round special-situations calculation testing whether you understand why a tender premium is not earned on every share tendered.
A company offers to repurchase shares at $25 while the stock trades at $23. You buy and tender 100 shares. The offer is oversubscribed and proration is 50%; assume untendered shares remain worth $23.…
Special-situations funds use rights offerings to test dilution maths and capital-structure judgement.
A company offers one right for every four shares owned; five rights buy one new share at $10. The stock trades at $14 before the rights detach. What happens to value, and what would you investigate?
A special-situations case that tests whether an analyst can value a binary post-close claim rather than quote its headline payout.
A target will be acquired for $40 cash plus one non-tradeable CVR. The CVR pays $10 if the FDA approves its lead drug by December 31 next year and pays zero otherwise. The target trades at $43.20; the…
Recovery analysis, capital structure relative value and covenant leakage. 3 questions
A claim-selection case used by credit funds to test whether an analyst maps who actually owns assets and cash flow.
A parent holding company has a $300m bond. Its operating subsidiary owns all assets, generates $80m of EBITDA, and has $400m of secured debt. The holdco owns only the subsidiary's equity. Explain why…
An offer-ready relative-value case for a credit hedge fund analyst seat.
A company has a 2027 secured note at 88 with a 10% coupon and a 2030 secured note at 82 with an 8% coupon. You expect the company to refinance its 2027 maturity within six months, but you are…
A harder relative-value question linking credit, equity and catalysts.
A company's secured bonds trade at 85 while the equity still implies meaningful value. How could a credit fund think about capital structure arbitrage?
Structuring for downside, collateral, priming risk and recovery. 2 questions
A realistic workflow question when a stressed borrower offers material non-public information to a lender group before an out-of-court restructuring.
You own a meaningful position in a stressed term loan. The company's adviser asks you to join a creditor group and sign an NDA to receive a restructuring proposal. What do you assess before signing,…
A practical distressed-credit question on buying bankruptcy claims rather than syndicated loans.
What are the distinctive risks when buying a bankruptcy claim, and why can the purchase price differ from the expected plan recovery?
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
Company tags reflect where a question type is commonly reported in interviews. They are not sourced from, endorsed by, or affiliated with Davidson Kempner.