Companies that suddenly face financial difficulties and enter negotiations with their key creditors need to understand potential future scenarios. It is also possible that a company in such a situation needs a restructuring plan and advice on how to achieve the best possible capital structure.
PwC can assist you in the following fields:
Assessing the existing capital structure, involving a review of loan covenants and securities.
Advising the client in negotiations with their finance providers to secure best possible financing terms.
Preparing and executing the restructuring strategy.
Writing a business plan and outlining future scenarios for the alternative ways of restructuring.
Acquiring financial resources and finding new sources of financing
Acquiring new financial resources up to the point of securing the new financial resource; project management; and communication with potential creditors.
Choosing the best financial resource among those available for the client and defining the optimum debt burden.
Management accounting tools and managing the expectations of different parties
Defining shareholders, creditors and other interested parties and coordinating the communication among them.
Developing a financing model to monitor cash flows and compliance with special terms in the loan agreement. Creating scenarios and stress tests.
Tax issues related to restructuring
Reorganizing shareholder participations and business activities always includes tax issues, be they related to income tax or VAT. Our international tax team will help you resolve both domestic and cross-border tax issues.
Drawing up transaction documents and negotiating
PwC can also be of assistance in providing a suitable legal solution for restructuring the company by helping you draw up relevant transaction documents and supporting you in negotiating the deal.
If business activities come to a standstill due to the state of emergency, one way of addressing the obligations that continue to pile up is reorganising the company.
Reorganisation – a proceeding conducted via courts - is an adequate tool for overcoming the period of economic difficulties caused by the impact of the virus, restoring liquidity and granting that the company can be sustainably managed.
Reorganisation allows for, inter alia, extended deadlines for performing one’s obligations, performing monetary obligations in instalments and reducing the company’s debt.
It is also possible to restructure taxes that the company owes and the obligations it has to the bank.
In the context of an unexpectedly changing economic environment, one should not think of reorganisation as a failure – on the contrary, reorganisation is a tool that should be employed without undue embarrassment, where necessary.