ATI INC (ATI) as of March 29, 2026 shows a deeply negative liquidation recovery posture, consistent with the MFFAIS-reported CLV of approximately negative $4.3B and OLV of negative $2.0B. Total assets of $5.23B face severe haircuts: cash of $401.7M recovers at par; gross AR of $668.3M recovers at roughly $601M-$635M (90-95%); gross inventory of $1,680.3M (net $1,580.3M after $100M valuation reserve) recovers at 60%, yielding approximately $1,008M—a $672M haircut from gross book; net PP&E of $1,951.5M (against gross of $4,227.5M, accumulated depreciation $2,276M) recovers at 50-70%, yielding approximately $976M-$1,366M; goodwill of $225.2M and intangibles receive zero recovery. On the liability side, face-value obligations include long-term debt and current debt totaling approximately $1,827.9M principal, operating and finance lease obligations embedded in the $1,794.7M LTD line, pension liability of $42.3M (underfunded qualified plan, net of plan assets), OPEB liability of $154.2M, deferred contract liabilities of $138M noncurrent plus $154.4M current, accounts payable of $654.9M, accrued liabilities of $189.1M, supplier finance program obligations of $101M, and other noncurrent liabilities of $307.1M. The structural negative recovery is driven primarily by: (1) inventory representing 30% of total assets at 60-cent-on-the-dollar recovery due to high work-in-process content ($1,268.2M of $1,680.3M gross); (2) PP&E at 50-70% recovery on $4.2B gross cost base with specialized aerospace/defense manufacturing equipment that has limited alternative-use markets; (3) face-value liabilities including $1.83B debt stack, $196.5M combined pension/OPEB obligations, and $292.4M combined contract liabilities that do not extinguish on windup. Quarter-over-quarter from December 28, 2025, inventory increased $177M (gross) and accounts payable increased $86.7M, with net debt rising from $1,344.3M to $1,437.1M, primarily from $75M ABL draw and $75M share repurchase. The $100M inventory valuation reserve increased from $80.4M at prior year-end, signaling modest deterioration in inventory quality. Environmental liability reserves of $15M with a $19M possible upside exposure are immaterial to liquidation math but represent off-balance-sheet tail risk. The next significant debt maturity is $350M of 5.875% Senior Notes in Q4 2027, which is a fixed near-term liability claim in any wind-up scenario.
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