The new insolvency legislation currently making its way through parliament will have a significant impact on restructuring of distressed SME businesses (the moratorium is not available to companies with publicly traded debt in excess of £10 million). The government intend this as a smaller business rescue and reorganisation tool and not an insolvency or scheme of arrangement based balance sheet restructuring process.

Consensual restructuring continues to gain ground as the “go to process” for over leveraged and distressed business.

The economic consequences of the Coronavirus epidemic have heavily impacted stock markets worldwide as investors quantify and manage the risks in underlying businesses often by quickly disposing of their investments. Whilst investors can liquidate their positions quickly the challenges for business managers run deeper. Decisions take longer to impact results and can be overturned by the unpredictability of the crisis. Most businesses will be impacted in some way and for many it will take management teams into new territory, the “zone of insolvency”.

London schemes industry set back! Are we about to see an end to aggressive “schemes forum shopping”?