In an average week, more than 300 companies. And more than 75% of the company desperately file for a “liquidation bankruptcy,” the agreement to a full distribution of their assets to the creditors. The remaining 25% refuse to give a final option exhausted: petition the courts for a “reorganization bankruptcy”, trying to convince its creditors temporarily freeze their claims while it reorganizes in profitable new business. The correct and timely use of bankruptcy reorganization … Read more »

In an average week, more than 300 companies. And more than 75% of the company desperately file for a “liquidation bankruptcy,” the agreement to a full distribution of their assets to the creditors. The remaining 25% refuse to give a final option exhausted: petition the courts for a “reorganization bankruptcy”, trying to convince its creditors temporarily freeze their claims while it reorganizes in profitable new business. The correct and timely use of reorganization bankruptcy can bring relief from otherwise devastating debt; selected for the right reasons and implemented correctly, it can provide a financially, strategically and ethically sound basis for the interests of all parties. A model for the analysis of the situation and bankruptcy turnaround response offered. The successful integration of reorganization bankruptcy as an important part of a strategic plan based on an understanding of bankruptcy law is based and how the rules of the company and the timely use of Chapter 11, as it was intended – systematically and restrict together a new strategy to support all parties involved awaken. It should never have become a popular strategic choice,., But if it is carried out properly, it can revive a deserving organization
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from
John A. Pearce,
Samuel A. DiLullo
Source: Business Horizons
7 pages.
Publication Date: Sep 15, 1998. Prod #: BH014-PDF-ENG
If a strategic plan Bankruptcy HBR case solution