Corporate restructuring finance in times of crisis

[...]... monitoring instruments that track the sustainability of the initiated restructuring measures in terms of financial efficacy and goal attainment 3 Innovative Ways out of Crisis Situations The RBSC restructuring approach has a proven practical track record in terms of corporate crisis management In the following chapter we will introduce four innovative methods that can lead companies out of crisis situations... Insolvenzverfahrens (Restructuring During Insolvency) In: Bickhoff, Nils et al (Editors): Corporate Crisis as an Opportunity – Innovative Approaches to Recapitalization and Restructuring) , Berlin a.o., pages 139-165 Corporate Restructuring in Germany – The Economy Remains Tense, but Restructuring Offers Definite Opportunities Bernd Brunke, Stephan Foerschle, Sascha Haghani, Florian Huber, Nils von Kuhlwein, and... Optimized linkage of existing locations, competencies, etc • Varying degrees of vertical integration • Outsourcing vs insourcing/ forward integration Optimized control systems Reduced target portfolio • Synergy utilization • Cost cuts • Improve utilization of know-how • Focused resources Fig 5: The elements of corporate restructuring 3.4 Utilizing Insolvency as a Restructuring Opportunity In the introduction... worth restructuring If this is not the case, or if the causes of the corporate crisis are operational inadequacies, restructuring on the basis of insolvency does not hold a lot of promise Thanks to the option to apply for insolvency early on, i.e in the event of impending inability to pay, the new insolvency statute protects creditors from suffering continued damage At the same time, introduction of the... (fresh money) • Relieving the pressure on balance sheet and earnings • Stabilizing the financing circle • Participation of the financing circle in the success of the company • Paving the way for strategic cooperation A heterogeneous financing circle representing diverging stakeholder interests and objectives is often the starting point for recapitalization Consequently, providing credit institutions and... businesses of any size and in every industry The headlines of the financial press announced bad news affecting a whole slew of prominent crisis candidates in 2004/2005, including KarstadtQuelle, Agfa Photo or Salamander While public interest focuses on these spectacular cases, a large number of companies are fighting their final battle for survival in quiet oblivion Although for the first time since... goal of financial restructuring is reestablishment of a healthy and solid capital structure In the course of operational restructuring measures required to improve the earnings and liquidity situation along the value chain are defined In addition to strategic reorientation of the company, strategic restructuring includes the structural and process-relevant (re)organization of the corporate units All of. .. influx, in particular also by way of a capital increase Approximately three fourths of those businesses that were able to implement a capital increase in a time of crisis attained sustained positive results In summary, it has been established that at the core, restructuring always follows a similar path In this context, the approach based on RBSC's integral restructuring concept has proven itself in. .. implementation – time invested that certainly paid off 3.2 Reaping the Profits of a (Self-Initiated) Industry Consolidation The decline in demand caused by hesitant buying patterns and the intensified pressure on pricing due to fiercer competition (which is increasingly being internationalized), confront German companies with huge challenges Even after years of successful operational restructuring and despite... likelihood of success • The corporate restructuring approach better focuses corporate activities (business portfolio and value chain), while increasing reserves and using resources in a targeted manner The benchmark for future growth is based on a clean slate • Restructuring during/from insolvency is another approach offering an opportunity of growth based on a clean slate The companies involved can . dynamic monitoring instruments that track the sustainability of the initiated restructuring measures in terms of financial efficacy and goal at- tainment. 3 Innovative Ways out of Crisis Situations. LAFRENZ X 1 Crisis Companies Have to Fulfill High Profit Expectations 43 2 Restructuring Companies in Crisis 45 3 Increasing Corporate Value Even (and Especially) During the Restructuring Process. 6 3 Innovative Ways out of Crisis Situations 8 4 Summary: Consolidate Quickly, Return to Growth Quickly 17 Corporate Restructuring in Germany – The Economy Remains Tense, but Restructuring Offers