Our experts advise companies in distress to enable them to adopt the decisions best suited to restructuring their business from an operational or financial standpoint. The Firm’s advisory services take in everything from labor and employment law aspects to insolvency, financial and tax-related matters. Our extensive experience of restructuring companies ensures that adjustment plans are tailored to the needs of the business and the market situation.
Garrigues also advises financial institutions on protecting their claims and collateral in insolvency situations, actively assisting with debt recovery and periodically monitoring any incidents at court that may have a bearing on the position of banks, savings banks or financial credit institutions.
Garrigues’ extensive office network enables our restructuring experts to be on hand near our clients and allows us to speak on their behalf directly with the financial or court authorities and with the other local players affected by and involved in business distress situations.
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2011 saw wholesale reform of the insolvency legislation, monitored closely by Garrigues. Our lawyers have taken part in numerous conferences and seminars looking at the scope of the new legislation and have kept our clients up to speed on the latest developments. Carrying on with this awareness-raising work and keeping one step ahead of any potential future changes and difficulties is one of the Restructuring and Insolvency Department’s daily challenges.
The work of our professionals is constantly singled out for praise by renowned specialist publications. The Firm’s Restructuring and Insolvency Department takes top spot in various international legal directories, which spotlight the finest business crisis management experts. At the last edition of the European Financial Times Innovative Lawyers 2011 Awards, our professionals took runner-up spot in the Legal Innovation in Finance Law category, for having persuaded a commercial court, using groundbreaking arguments, to fast-track approval for an arrangement between a business group and its creditors, a first in the history of the Spanish justice system, thus minimizing the damage caused to the company by avoiding an needlessly drawn-out insolvency proceeding.
Business restructuring processes
Our specialists design and implement the optimal business restructuring strategies thanks to the innovative development of legal measures to save operating, labor and employment, tax, financial and real estate costs. Their advice also covers downsizing, relocation and orderly liquidation processes, and changes in business strategy.
On the debtor side, Garrigues’ lawyers identify the optimal type of refinancing (syndicated; bilateral; with an independent expert; with or without court approval), analyzing the classes of debt affected and defining the goals of the process, catering to the motivations of the key players (financial institutions, companies, suppliers, workers, the public authorities, etc.). When advising companies on refinancing, our team of experts acts in the negotiation of standstill agreements, the search for new financing, and asset sell-offs and debt swaps. When advising financial institutions, our lawyers analyze the type of proposed refinancing, scrutinizing the security package and examining the viability plan and debt repayment schedule. They also design stress tests for security in the event of insolvency, suggest and recommend other alternatives, as well as acting in the negotiation of standstill and intercreditor agreements, including applications for court approval of the agreement reached by the majority of the financial institutions.
Acquiring assets and debt from distressed companies
Our restructuring and insolvency professionals conduct legal due diligence reviews of non-performing loans sale or purchase transactions, providing advice throughout the process, including the drafting of confidentiality agreements, the formalization of offers, the drafting of sale/purchase agreements, etc.
Our experts design loan-to-own strategies, mitigating the legal risks of acquisitions and speeding up implementation times.
Pre-insolvency situations and insolvency proceedings
From a debtor perspective, Garrigues’ lawyers propose bespoke solutions in order to weather the crisis and expedite the decision-making process. Making use of out-of-court procedures and court proceedings (such as pre-insolvency procedures and formal insolvency proceedings), they take charge of implementing restructuring plans and advising on the sell-off of assets, lines of production or productive units, seeking to strike a balance among all the parties concerned (purchaser, seller, workers, insolvency managers, etc.)
On the creditor side, our team of experts designs the most efficient debt collection and recovery strategies. They advise on and take charge of enforcing security interests or financial collateral, including enforcement against shares and other equity interests. The team negotiates with insolvency managers to maximize debt recovery, advising on the acquisition of assets from businesses in insolvency or pre-insolvency situations.
On the debtor side, Garrigues’ lawyers design swift, competitively priced strategies to maximize cash inflows by implementing supplier payment plans, individual or collective agreements, or bringing claims in or out of court. On the creditor side, our experts analyze the debtor’s solvency position in order to assess how far its debts are recoverable directly or indirectly (lifting of the corporate veil), making it possible to obtain a return equal or close to the nominal value of the claim.
Liability of directors, board members and executives
The Firm’s restructuring and insolvency experts analyze the potential (commercial, tax, labor/employment and criminal) liability of directors, executives and attorneys-in-fact of companies that are insolvent or on the verge of becoming so, and, particularly, any liability that may flow from the insolvency proceedings as such.