Preserving value before and during insolvency.

Pre-insolvency advisory is intended to help you gain an overview of your business’ current situation. The primary objective is first to clarify what stage of the crisis your company finds itself in and whether you are required to file for insolvency. According to the German Insolvency Statute (Insolvenzordnung; InsO), there are three grounds for insolvency filing, each of which call for different types of solutions:

Requirement to file for insolvency

• Insolvency pursuant to InsO Section 17
• Overindebtedness pursuant to InsO Section 19

Right to file for insolvency

• Imminent insolvency pursuant to InsO Section 18

No requirement to file for insolvency

• Pre-insolvency recovery

During the pre-insolvency recovery process, it is possible to rescue the company without entering insolvency. This is generally achieved by creating a recovery report in accordance with German Institute of Public Auditors standards (IDW S6) and having liquidity supplied by investors or selling assets to release liquidity.

Alternatively, there is the option of restructuring the company while in insolvency. In particular, insolvency with debtor-in-possession management can be a useful instrument to restructure liabilities or dispose of loss-making activities.