Allegion plc (ALLE) presents a deeply negative liquidation recovery posture as of March 31, 2026, consistent with MFFAIS CLV of -$2.61B. The balance sheet is dominated by intangible assets and goodwill that carry zero recovery value under liquidation assumptions, while liabilities are held at face value. Total assets of $5.31B are offset by total liabilities of $3.21B, leaving reported book equity of $2.10B. Under liquidation haircuts, however, recoverable asset value collapses substantially. Goodwill of $1.93B and intangible assets net of $836.5M ($729.9M finite-lived plus $106.6M indefinite-lived) together constitute approximately $2.77B of assets that receive zero recovery — representing roughly 52% of total assets. The remaining tangible asset pool includes cash of $308.9M (100% recovery), net receivables of $512.3M (90-95% recovery, yielding ~$470-$485M), inventory of $537.2M (60% recovery, yielding ~$322M), and PP&E net of $450.1M (50-70% recovery, yielding ~$225-$315M). Estimated tangible asset recovery is roughly $1.33-$1.44B against face-value liabilities of $3.21B, producing a shortfall of approximately $1.77-$1.88B — consistent with the reported operating liquidation value of -$1.56B. Since the prior filing (10-K, December 31, 2025), debt has risen $50M from $1.99B to $2.04B gross, driven by a $50M net increase in revolving facility borrowings to $240.6M, used to fund the $70M DCI acquisition closed March 2, 2026. Goodwill increased $29.1M from acquisition, adding to the already-dominant zero-recovery intangible stack. The revolving facility at $240.6M vs. $1.0B capacity preserves liquidity headroom but the drawn balance is up $50M QoQ. Operating lease obligations of $242.6M (undiscounted) survive liquidation at face value, adding to the liability stack. No pension obligation reset was disclosed this quarter; expected employer contributions for the remainder of fiscal 2026 are $3.9M, indicating no material pension funding stress. The asset mix has not structurally changed — this remains a going-concern-dependent balance sheet where equity value is entirely attributable to franchise/earnings power, not tangible assets.
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