Insolvency-related advisory
Every corporate crisis arises from unique causes and follows its own trajectory. In such turbulent business situations, it is imperative for companies and their managing directors to familiarize themselves with the requirements and strategic options related to insolvency. One thing is certain: only those who are well-informed can make the right decisions.
Our services
We understand the complexity of insolvency-related situations and support you with dedication and empathy on the path to economic and organizational stabilization. Along the way, we actively engage in the necessary communication with insolvency administrators, creditors, and new investors. Our goal is to steer your company back on course and ensure sustainable success. Our team is pleased to advise you on pre-insolvency and insolvency-related matters – our services include:
Determination of insolvency status
- Assessment of the existence of grounds for opening insolvency proceedings
- Preparation of IDW S11 expert opinion
- Development of options analysis
Preparation of insolvency proceedings and preventive restructuring under the StaRUG
- Preparation of a debtor-in-possession plan
- Preparation of a protective shield certificate
- Development of restructuring plan/concept
Assistance in insolvency and StaRUG processes
- Development of restructuring concept
- Development of integrated business planning
- Liquidity management support
- Development of insolvency and restructuring plans
We support you with a assessment to determine the existence of grounds for opening insolvency proceedings. In doing so, we follow the IDW S 11 standard developed by the Institute of Public Auditors in Germany (IDW) and examine, based on the current financial status and a going concern forecast for the next 24 months, whether your company meets the insolvency criteria stipulated in the German Insolvency Code (InsO): illiquidity (§ 17 InsO), imminent illiquidity (§ 18 InsO), or over-indebtedness (§ 19 InsO). This analysis can subsequently serve as a foundation for legal advice provided by an insolvency law expert.
If required by stakeholders (e.g., shareholders, financiers), we can also prepare a formal expert opinion in accordance with IDW S 11.
When companies are in existential crises, shareholders and management generally have several strategic options. In addition to a traditional out-of-court restructuring, alternatives include a sale, a StaRUG proceeding, insolvency proceedings (debtor-in-possession or regular proceedings), or an out-of-court liquidation. We assist you by preparing an options analysis that considers both economic and legal aspects, providing a solid basis for deciding whether to restructure, sell, or wind down the affected company (or parts thereof).
When applying for insolvency proceedings under self-administration, the application must be accompanied by a self-administration plan that includes the following components:
(1) A financial plan covering a period of six months, including anticipated insolvency-specific costs and effects.
(2) A procedural concept for conducting the insolvency proceedings based on a crisis analysis.
(3) A presentation of the current status of negotiations with stakeholders.
(4) Measures to ensure compliance with insolvency law obligations.
(5) A cost comparison between self-administration and regular proceedings.
If, at the time of filing, insolvency has not yet occurred, it is possible to apply for self-administration under the so-called protective shield proceeding. In this case, the application documents must include, in addition to the management’s self-administration plan, a certificate in which we, as external experts, confirm that insolvency is imminent and the company may already be over-indebted, but insolvency has not yet occurred and the intended restructuring does not manifestly lack the prospect of success.
If you intend to utilize the instruments of the stabilization and restructuring framework, this must be notified to the competent restructuring court. The notification should include, among other things, a draft restructuring plan or, if not yet available, a restructuring concept. We support you in preparing the restructuring plan or concept. Additionally, when applying for a stabilization order, we assist you in preparing the necessary documents (draft restructuring plan/concept and a financial plan covering a six-month period).
If a restructuring practitioner is to be appointed in the StaRUG proceedings and you, as the debtor, wish to secure your proposal for the court-appointed individual, you will need a certificate from an expert experienced in restructuring and insolvency matters, confirming that the debtor meets the requirements of Section 51 (1) and (2) StaRUG. In this case, the court may only deviate from the debtor’s proposal if the suggested individual is obviously unsuitable, which must be justified. As experts, we prepare this certificate in accordance with IDW S 15.
At the core of every restructuring lies the development of a restructuring concept. This encompasses strategic, financial, and operational measures identified and formulated based on a comprehensive crisis analysis.
The effects of the restructuring concept are subsequently translated into accompanying financial models. We assist you in creating an integrated business plan that reflects the impacts of the insolvency or StaRUG proceedings and the effects of the proposed measures, thereby forming the foundation for, among other things, the insolvency or restructuring plan.
Additionally, we support and accompany the proceedings in all business management matters, particularly in regular reporting, liquidity management, and the continuous updating of financial planning.
In preparing insolvency or restructuring plans, we are pleased to take on the descriptive section for you. This includes presenting and explaining the crisis analysis along with the resulting restructuring concept, outlining the vision for the restructured company, depicting the effects of the measures in an integrated financial projection, and providing a detailed comparative analysis of the various restructuring alternatives from the creditors’ perspective.
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