rescue-page

Rescuing companies in financial distress is now more than ever before not just a possibility but also a reality with the introduction of Business Rescue in terms of Chapter 6 of the New Companies Act, No. 71 of 2008.

Business Rescue has created a mechanism for South African companies which are financially distressed or even trading in insolvent circumstances to reorganise and restructure their businesses to alleviate the distressed state of affairs in order to secure the future of its existence. Business Rescue is not without its effects on the employees, creditors, shareholders, financial institutions and the local, national and international economy.

Our Business Rescue & Restructuring team lead by Jörg Frese, a registered senior Business Rescue Practitioner, has gained extensive experience and knowledge with the legislation and the manner in which Business Rescue proceedings should be implemented in the prevailing circumstances of the company to optimise the probabilities of successfully rescuing a company in distress. Our experience has enabled us advise our clients on the timing of and manner in which Business Rescue proceedings are to be filed, the appointment of a Business Rescue Practitioner as well as the rights and obligations of all the parties affected by Business Rescue proceedings.

Business Rescue aims to optimise the prospect of the continued existence of a company on a solvent basis by the successful implementation of a Business Rescue Plan which has been adopted by creditors. The crucial component to the success of Business Rescue proceedings lies in the ability to provide Business Rescue that will yield more benefit to creditors than they would be yielded from immediate liquidation proceedings.

The time periods prescribed by the Companies Act in terms of which Business Rescue proceedings are to be instituted and finalised are extremely short and a party affected thereby requires fast and accurate advice in order to ensure its interest are protected. Our unique position of being the Business Rescue team has honed our ability to advise Companies requiring to institute Business Rescue proceedings as well as creditors, shareholders, employees or any other parties affected thereby.

Our services cover every aspect business rescue which include:

  • Being appointed as Business Rescue Practitioner

o  Negotiate and arrange post Business Rescue commencement finance

o Develop a plan for the restructuring of a company which will be acceptable to creditors, shareholders, employees or other affected parties

o  Implement the Business Rescue Plan as adopted by creditors

  • Assisting the company prior to Business Rescue and advising

o  Whether it could be deemed to be trading in insolvent circumstances

o Whether the directors of a company should pass a resolution for the commencement of Business Rescue Proceedings

o Whether the appointed Business Rescue Practitioner is properly and adequately executing his duties

o The protection of interest in property or other assets necessary of the continued existence of the company

  • Assisting creditors by

o Advising creditors as to the launching a Court Application for an order placing a company in Business Rescue rather than the liquidation of the company or opposing a Business Rescue Application

o Attending creditors’ meetings and presenting and negotiating their claims.

o Interacting with the Directors and Business Rescue Practitioner of the company

o Advising on the impact and rights and obligations of creditors in respect of the general moratorium on the institution of legal proceedings against the company which has commenced Business Rescue proceedings.

o What the effect of the Business Rescue has on the contracts concluded between the company and creditors

o Advising on the effects of the Business Rescue Plan developed by the Business Rescue Practitioner to enable the creditors to decide whether or not it will vote against or in favour of the Business Rescue Plan.

o Advising on any compromise that may be incorporated in the Business Rescue Plan in terms of section 155 of the Companies Act.