Business Restructuring in a Crisis

Crisis periods, regardless of their origin, put businesses in front of the need for quick and effective solutions. Restructuring is becoming a key tool for the survival and further development of the company in conditions of uncertainty.

What is business restructuring?

Restructuring is a set of measures aimed at changing the structure, management and financial condition of the company in order to increase its efficiency and adapt to new conditions.

Types of restructuring:

  • Financial restructuring: 
    • Leverage optimization.
    • Revision of lending conditions.
    • Attraction of additional financing.
  • Organizational restructuring: 
    • Change in the management structure.
    • Reduction or expansion of staff.
    • Optimization of business processes.
  • Operational restructuring: 
    • Revision of the range of products or services.
    • Optimization of production processes.
    • Search for new markets.

Stages of restructuring:

  1. Analysis of the situation: 
    • Assessment of the company’s financial condition.
    • Identification of the causes of the crisis.
    • Analysis of the market situation.
  2. Development of a restructuring plan: 
    • Definition of goals and objectives.
    • Selection of optimal measures.
    • Development of the implementation schedule.
  3. Implementation of the plan: 
    • Implementation of the necessary changes.
    • Control over the implementation of the plan.
    • Adjust the plan as needed.
  4. Evaluation of results: 
    • Analysis of the results achieved.
    • Adjustment of the development strategy.

Legal aspects of restructuring:

  • Reorganization of the company: merger, affiliation, division, separation.
  • Bankruptcy and rehabilitation: procedures for restoring solvency.
  • Labor legislation: staff reduction, change in working conditions.
  • Contract law: revision of the terms of contracts with counterparties.

Recommendations:

  • Involve qualified lawyers and attorneys in the restructuring process.
  • Develop a detailed restructuring plan, taking into account all possible risks, in accordance with current legislation.
  • Maintain open communication with employees and contractors.
  • Be prepared for rapid changes and adaptation to new conditions.

Conclusion:

Restructuring is a complex but necessary process for the survival of a business in a crisis. Seeking legal assistance in a timely manner and developing an effective restructuring plan will help your company not only overcome the crisis, but also come out of it stronger.

We have experience and a desire to help business!

WRITE TO US