Insolvency-related advice: The right restructuring measures at the right time

Financial distress need not always lead directly to insolvency. In order to address a crisis proactively and with preventive restructuring measures, companies need above all to identify signs of distress and risks as early as possible. If the signs are interpreted correctly and effective countermeasures are taken to eliminate the risks, it is often possible to avoid an existential crisis and significantly enhance the company’s resilience.

Restructuring of a company may be needed as a result of external influences. Sometimes, however, the threats to a company’s viability lie in its own operations, its business model, or its immediate environment. Wherever the problems lie, once the challenges have been identified, effective action can be taken to counter them before distress becomes an existential crisis.

With our insolvency-related advice we can help you identify the internal and external causes of financial difficulties at an early stage and devise and implement effective restructuring measures. Various tools are available, and with you we will select the right ones for your challenges.

We are sure: every crisis is an opportunity for genuine realignment.

Insolvency-related advice

Safeguarding companies with out-of-court restructuring measures

It is always advisable first to attempt an out-of-court reorganisation. The basis for a reorganisation of this kind is a plausible and robust restructuring plan. Parties affected by restructuring, particularly creditors, are more likely to consent to restructuring measures if they are clearly substantiated and sufficiently likely to be effective. At Schultze & Braun, our first step when providing insolvency-related advice is always to try to reach an out-of-court agreement with all stakeholders – either in the form of a classic out-of-court reorganisation, or using the tools provided by the Act on the Stabilisation and Restructuring Framework for Businesses (Gesetz über den Stabilisierungs- und Restrukturierungsrahmen für Unternehmen, or StaRUG). To achieve this, we advise managers, shareholders and other stakeholders, design legally robust out-of-court restructuring measures and, if needed, manage a distressed M&A process.

At the same time, we ensure that you as manager or advisor minimise liability risks. Our experts will explain your options for securing your position and avoiding liability. If necessary, we also bring or defend insolvency-related claims before the courts.

Using corporate law to implement restructuring measures

In many cases, changes to the structure of a company help to reorganise successfully. Corporate law offers many options for implementing efficient restructuring measures within your company. Business units that can no longer be operated profitably can be hived off and sold. Companies can be established abroad, changed into another legal form or liquidated. Corporate law even serves to resolve shareholder disputes. As with all complex interventions in a company’s existing structure, key factors for success include careful planning of appropriate target structures and professional implementation of the necessary changes to contracts. We at Schultze & Braun have the necessary expertise.

Out-of-court reorganisation: securing liquidity and remedying the causes of distress

In addition to the corporate law tools, at Schultze & Braun we are also familiar with all other restructuring levers. In particular, we will work to secure liquidity and ensure sustainable funding for your company. We are also a reliable partner for targeted financial restructuring. We will design and structure all the financing instruments you need to strengthen your equity capital. We improve your capital structure and optimise your collateral, arrange liquidity-related restructuring measures on both sides of the balance sheet, and help you access injections of fresh capital if needed. This will help you avoid insolvency and create a sound basis for realignment of your business.

We also provide efficient receivables management services. We will pursue your financial claims against third parties and ward off unjustified claims directed at you. In addition, we can optimise your purchase, sale and project contracts. If needed, we can help you make changes to your staff structure and operational management.

As a member of the Loan Market Association, we also support credit institutions, banking syndicates and financial and strategic investors with lending, collateralisation and buying and selling of loan receivables.

The crisis as an opportunity

Turning financial distress of others into your advantage

Schultze & Braun knows from its insolvency-related advisory work: every crisis presents an opportunity for companies, shareholders and investors. There may be scope, for example, by acquiring a company at a favourable price or by disposing of business units that have become unprofitable. However, specific rules of insolvency law apply when a company is in distress, and these rules will have an impact on corporate transactions. Schultze & Braun is familiar with these particular features from our work on numerous distressed M&A transactions on both the seller and buyer side. Our clients benefit from our extensive experience of negotiating with insolvency administrators, banks, employees, suppliers, customers and creditors.

We can also protect you as a creditor against financial loss if a company you deal with is facing or has already entered insolvency. We know that preparation is everything here. So at Schultze & Braun, advice to creditors begins not when their customer or supplier enters insolvency, but with forward-looking receivables and collateral management activities.

If a company you deal with enters insolvency, we will do far more than just file your claims for you. We will represent your interests on creditors’ committees and at creditors’ meetings and look after the granting and securing of insolvency estate loans. If necessary, we can also ensure that you can convert your outstanding claims into shares via a debt-equity swap.

Decades of experience in corporate reorganisation

Our decades of experience enable us to produce sustainable solutions, developed in partnership with the client and tailored to their individual requirements and situation. Many entrepreneurs are already taking the opportunity to reboot their business with us.

How about you?

Contact

Realigning perspectives

Dr. Ludwig J. Weber, LL.M.
Rechtsanwalt (Attorney at Law), Fachanwalt für Steuerrecht (Certified Specialist in Tax Law), Fachanwalt für Handels- und Gesellschaftsrecht (Certified Specialist in Commercial Law and in Company Law)

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