What is insolvency and what is restructuring?
Insolvency and restructuring refer to the legal processes and strategies employed when a business is facing financial or operational difficulties or both. Insolvency involves a company’s inability to pay its debts, while restructuring focuses on implementing changes to improve financial stability and operations, aiming to prevent formal insolvency or facilitate recovery.
Insolvencies may be corporate or personal. They may be triggered by macro-economic factors or by factors specific to an industry, sector or individual business or person. Corporate entities may require restructuring whether or not they are insolvent. A restructuring differs from a formal insolvency (known as a company’s liquidation or winding up or bankruptcy if an individual). A formal insolvency is aimed at liquidating assets to distribute the proceeds amongst creditors. The process will generally result in a company’s business operations terminating and the company ultimately ceasing to exist. A solvent restructuring may be required as a result of a take-over, merger, revision of business strategy or change to regulatory requirements In an insolvency scenario, restructuring is a process by which a company under financial distress develops and implements a plan that allows the company to improve its financial position, with the ultimate goal of continuing its business operations. A restructuring can be achieved through an in-court or out-of-court process.
Our team has extensive insolvency and restructuring experience across a wide range of industries, including retail, hospitality and leisure, healthcare, financial services, real estate, oil & gas and manufacturing.
Offshore insolvency lawyers
We provide clear, sound and timely advice on the full spectrum of contentious and non-contentious insolvencies and restructurings. Our global presence enables us to provide comprehensive, multijurisdictional legal advice at the times most critical to our clients.
Our team of insolvency and restructuring lawyers are experts in advising on all aspects of the law, including:
- Directors and other fiduciaries, including trustees, on their duties and personal exposure
- Secured creditors on possible enhancements to their security net and options in an enforcement scenario
- Option, whether in court or out of court for creditors and ad hoc groups to maximise recoveries
- Acting as offshore counsel in court proceedings in support of or to implement a restructuring and to oppose hostile creditor action
- Appointment, recognition and removal of administrators, liquidators, receivers and provisional liquidators and their powers and duties while in office
- Instigating or challenging désastre, dégrèvement, just and equitable winding up and other jurisdiction specific insolvency procedures
- Recognition proceedings for insolvency practitioners, both into and out of our international jurisdictions
- Refinancing, rescue and restructuring
- Pre-pack sales / accelerated M&A processes
- Holistic restructuring solutions such as schemes of arrangement, amalgamation and reconstruction, privatisations, debt for equity swaps and capital reductions
- Government imposed sanctions in the distressed arena
- Fraud, asset tracing, recovery and constructive trust proceedings
- Cross-border issues, conflict of laws and cooperation between jurisdictions
- Related regulatory advice and obtaining requisite regulatory consents and no objection letters
Restructuring and insolvency law firm
Among restructuring and insolvency law firms, we are renowned for our innovative approach and in-depth understanding of global legal frameworks. In particular, our ability to consistently deliver comprehensive and tailored solutions makes us a trusted partner for companies navigating the intricacies of corporate restructuring and insolvency, with our global team of offshore lawyers regularly being noted by leading legal directories for their frequent handling of high-profile commercial disputes and insolvency proceedings.
Client experience
Representative Work in offshore insolvency law and restructuring matters
Adviser to Barclays Private Bank
Advising Barclays Private Bank and Trust Limited in its capacity as corporate director of certain companies in the Belgravia Group, including giving urgent advice on various winding-up and other options available in light of the insolvency of certain of the companies.
Adviser to China Fortune Land Development Co. Ltd.
Acted as offshore counsel to China Fortune Land Development Co. Ltd. on its USD4.96 billion offshore debt restructuring by way of an English scheme of arrangement. This landmark deal is the largest offshore restructuring transaction completed by a Chinese company in recent years and also the first English scheme of arrangement of a Chinese real estate developer in the current wave of defaults.
Adviser to Sea Containers Ltd.
Advising Sea Containers Ltd. on the Bermudian aspects of its restructuring plan and emergence from Chapter 11 bankruptcy, specifically on the incorporation of newly formed Bermuda companies, transfer of assets to the new companies and loan and security documentation.
Adviser to Shimao
Acted as BVI and Cayman Islands counsel for Adventure Success, a subsidiary of Shimao, on its USD1.5 billion loan from the Singapore-based United Overseas Bank. This transaction was been recognised as one of the “Deals of the Year” 2022 by China Business Law Journal
Adviser to Merced Capital
Acted as offshore counsel to Merced Capital on the restructuring and acquisition of the Telford Offshore Group following a share charge enforcement and competitive sales process. Advised on and filed for the winding-up of the rump group entities following the completion of the competitive sales process.
Adviser to Walton Insurance Company
Advising on and obtaining the sanction of the Supreme Court on a solvent scheme of arrangement for Walton Insurance Company Limited, commencing insolvent winding-up proceedings and advising on the liquidation and the operation of the scheme in the context of the insolvency.
Spotlight
Insolvency & Restructuring in Cayman
Appleby’s Cayman Islands office is a leading force in Cayman insolvency and restructuring matters, delivering unparalleled expertise to clients. With a proven track record and a deep understanding of international regulations, our team of Cayman lawyers excel in financial and corporate restructuring cases, cross-border insolvencies, and distressed asset recovery. This knowledge and expertise also see us work on some of the largest and most complex offshore cases, advising and being engaged by a large number of global law firms and leading institutions.
What is insolvency and restructuring?
Insolvency and restructuring refer to the legal processes and strategies employed when a business is facing financial difficulties. Insolvency involves a company’s inability to pay its debts, while restructuring focuses on implementing changes to improve financial stability and operations, aiming to prevent insolvency or facilitate recovery.
How does restructuring help insolvent organisations?
Restructuring helps insolvent organisations by providing a framework to address their challenges effectively. It involves various measures such as debt renegotiation, asset sales, cost reduction, and operational adjustments. By implementing these changes, restructuring aims to stabilise the organisation’s finances, enhance its visibility, and potentially lead to its recovery or an orderly wind-down process.
