A well-drafted plan is the cornerstone of any restructuring procedure. Without it, getting the debtor out of financial difficulties and back to its previous market activities is not possible.
– It is a signpost to get out of the crisis and restore the ability to act effectively. It is the basis for adopting arrangement proposals and their implementation. This is the backbone without which in most proceedings it is impossible to file an application to the court to open restructuring proceedings, conduct it efficiently, ensure coordination and monitoring of activities, and above all, end successfully for all stakeholders - explains Małgorzata Anisimowicz, president PMR Restructuring Management Board.
The preparation of a plan during restructuring proceedings, in addition to the proceedings for approval of an arrangement, is mandatory. It is drawn up in two stages. The first, a preliminary one together with an explanatory memorandum indicating that its implementation will restore the debtor's ability to perform its obligations, is submitted to the court together with the application for the opening of restructuring proceedings. This plan is prepared by the company, i.e. the debtor. In practice, however, its preparation is usually outsourced to a hired service of proceedings of a restructuring consultancy firmas this document becomes the foundation of the whole process.
The second stage is the development of a plan for the restructuring process itself, which already takes place after the opening of proceedings. It is prepared by a court-appointed supervisor or administrator. In specific cases, its preparation may be commissioned from third parties.
Therefore, it is extremely important to choose a restructuring advisor who provides with his resources comprehensive support in the process of handling the company. It is also important that he or she has experience in cooperating with investors.
– For the restructuring projects we carry out, we appoint an interdisciplinary team, composed of, among others, restructuring advisors, experts in the field of law, finance, including financial modeling, management, taxes and accounting, experienced negotiators and market analysts. We thus provide comprehensive service restructuring within one company, i.e. from the stage of decision on the intention to restructure to its final result, taking into account support in obtaining financing and the security of implementation of the entrusted project – explains Małgorzata Anisimowicz.
Partnership is important restructuring company and companies. As experts emphasize, it is necessary to involve the owner in the process companies at every stage of the restructuring plan.
- In the restructurings we have carried out, it is the total commitment to the outcome and the partnership cooperation of the expert team with the business owners that has been one of the most important factors contributing to the success of the proceedings, i.e. the conclusion of an agreement with the creditors and the return to market activity,' Małgorzata Anisimowicz points out.
The restructuring law specifies the time for developing a restructuring plan. For example, in accelerated proceedings, within two weeks the court supervisor prepares and submits to the judge-commissioner a restructuring plan taking into account Restructuring proposals presented by the debtor. In turn, in sanitation proceedings and arrangement proceedings – the administrator, in agreement with the debtor, submits a restructuring plan to the judge-commissioner within 30 days of the opening of the proceedings. In justified cases for remedial proceedings, the deadline for submitting a restructuring plan may be extended to three months.
– The time to prepare a good restructuring plan depends on, among other things, the size of the company, the number of creditors and the assets held – explains Sebastian Szałek, expert PMR Restructuring.
Given the objectives pursued by restructuring proceedings, it is important, according to experts, that the restructuring plan should include an assessment of the rationale of the entire process. It should be preceded by a thorough analysis of the reasons for the company's difficult economic situation, a description and overview of the planned restructuring measures and the associated costs. This should be accompanied by a timetable for implementation and a description of the company and a presentation of the strategy for running it both during the restructuring proceedings and during the implementation of the arrangement. Information on the company's production capacity, profit and loss project and a description of financing methods and sources are also important.
- Therefore, the preparation of a restructuring plan must be preceded by a thorough analysis of numerous documents, which must be provided to the supervisor or manager by the restructured company. It is necessary here to cooperate closely not only with the owner, but also with the accounting and HR services, which immediately after the opening of proceedings will start preparing documents on the basis of which the restructuring plan will be drawn up," says Sebastian Szałek.
on 25 February 2020We invite you to read the full version:" Step-by-step restructuring - how to get your company out of trouble
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