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Distress Restructuring?
Anil
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What is distress restructuring? How do we define it? When is it carried out? How? (...) Read more? Sign up for free
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Distress Restructuring
Jaap de Jonge, Editor, Netherlands
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The term distress restructuring belongs in the corporate finance realm rather than change and organization. When a firm is in a financial crisis or facing bankruptcy, this umbrella term is used to indicate the corporate turnaround from severe financial distress through methods such as Debt/Equity Restructuring, Working Capital Management and Corporate Valuation.
Therefore in distress restructuring, the term "restructuring" is not used in an organizational, but rather in a financial perspective.
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Meaning of Distress Restructuring
Srinivasa Rao Kilaru, Business Consultant, India, Member
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Distress causes due to illiquidity due to poor structuring of working capital at various levels (viz work-in-progress, bills receivable etc.) of business. Such a company must undertake restructuring strategies (incentives for early payment, delaying in payments to creditors etc) and activities to come out of this situation. Those activities are called distress restructuring.
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