If you decide to reorganize a legal entity, you are probably motivated by factors that have led or may lead to stagnation of the company. Of course, this important decision should be taken only after careful consideration of all aspects of the issue. In this summary, we offer a brief list of key points to consider when assessing the appropriateness of a reorganization, and direct action planning if such a decision is finalized.
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What is restructuring? It is a system of measures taken to increase the value of the company, which has the character of radical changes in the property complex and aimed at transforming the volume, composition, structure, and quality of assets and liabilities that form the company’s property.
Property restructuring can be carried out both within the framework of reorganization procedures and within the enterprise in the framework of the operational optimization program. In the latter case, restructuring methods are used in relation to individual elements of the business.
New opportunities
The main advantage of reorganizing an existing business is the emergence of new ways and means to develop and achieve business plans. To reorganize a company means to add to it the flexibility that is essential to increase competitiveness, as well as the overall efficiency of the business by saving costs and increasing shareholder value.
Planning
All parties involved should take part in the company reorganization, so it is necessary to take care of drawing up a quality plan where everyone has their individual role. It is necessary to take into account that any form of reorganization concerning changes of organizational and administrative aspects of the activity of the enterprise cannot be carried out without changes in the financial and economic sphere of activity, including in a property complex of the enterprise.
Obtaining consent
Obtaining written consent means making sure that all parties involved understand the need and appropriateness of the reorganization and that neither party takes it negatively. In addition, consent must be obtained from certain regulators - all regulatory permits must be obtained before the reorganization process begins.
HR issues
Obviously, the reorganization of an enterprise should affect employees. It is therefore important to remember that reorganization can lead to collective redundancies, and therefore measures must be taken to mitigate any undesirable consequences that may affect employees. For example, the main measure is to sufficiently inform employees from the beginning of the reorganization until the very end of the procedure.
Compliance with regulations
When reorganizing a legal entity, it is necessary to carefully monitor compliance with all regulations. Registration of the reorganization of legal entities created by reorganization is carried out in the terms provided by the legislation of each jurisdiction separately. In addition, after the reorganization is completed, it may be necessary to take a number of measures provided for by the legislation of a particular jurisdiction.
Our company’s highly qualified legal professionals provide our clients with legal assistance at all stages of a company’s reorganization or liquidation in various jurisdictions. This process is accompanied by the transfer of the company’s obligations and the rights of another company. If you are interested in reorganizing a company in the United States or are planning to reorganize a legal entity in Belgium or Luxembourg, please contact us directly through the contacts below.
