I agree replacement cost is the likely outcome. However, the poor guy should be able to justify a higher value than the cheapest one that can be found on e-bay.
For example, a “Hertz” Mustang in mint condition is worth way more than a Canadian Mustang with rusted out floor and a stuffed 6 cyclinder engine. And so the lovingly cared for bicycle is worth more than a “bista” version being sold at a garage sale.
He should determine a fair value for the taco’d bike and request that amount. If that money isn’t forthcoming, then any of the helpful suggestions already posted can be implimented as he deems necessary. 