How do you restructure a company? This article describes established strategies, from corporate takeovers in the 80s to pre-pack sales at the beginning of this century. Against this background, it claims that a new (potentially disruptive) trend is emerging from cases like Bombardier and Mitsubishi. This trend is represented by fire-acquisitions after the target company has been hit by a corporate scandal which has significantly depressed its market value (‘scandal strategy for corporate restructuring’).
We live in challenging times for the retail industry.
We vividly remember the spectacular collapse of BHS, which was put into liquidation in the U.K. in April 2016 after years of under-performance on the market – now dominated by online retailers – and a dubious sale for £1 to a former bankrupt with no experience in retail.
From ‘Liquidators’ to ‘Practitioners in the Field of Restructuring’: Sea Change or Cosmetic Maquillage?
The Proposal for a Directive on Preventive Restructuring Frameworks (November 2016) introduced a new figure in the insolvency and restructuring arena: the practitioner in the field of restructuring or PIFOR.
This note highlights the key similarities and differences between these professionals and (i) the ‘insolvency practitioners’ as defined by the 2015 EU Regulation on Cross-Border Insolvency Proceedings (recast) and (ii) the ‘liquidators’ as defined by the 2000 version of that regulation.
This note assumes that the key objective of the proposed directive is to achieve greater substantive harmonization of substantive insolvency practices and laws between the Member States. It therefore tests whether this assumption is valid with reference to the newly introduced notion of PIFOR.
It concludes, however, that the proposal fall short of the mark, since the new definition of PIFOR is unlikely to be interpreted in the same way across all the Member States.
In addition to that, this note highlights other issues associated with the proposed notion of PIFOR: (i) the uncertainty associated with the definition and its scope, and (ii) the possible relaxation of professional and ethical standards as a result of the competition between IPs and PIFORs.