Company restructuring

What is corporate restructuring?

Corporate restructuring generally means that a company or organisation acts to significantly change its finances and/or it’s operational structure with the aim of improving the business – whether this is for a sale, to limit financial harm or to grow.

There are a number of ways a company can restructure. The changes may include:

• Altering procedures
• Forming a group company structure
• Changing location
• Selling assets
• Altering its financial arrangements

There is no set way to restructure a company and what needs to be done will depend on the unique situation an organisation finds themselves in. For example, restructuring a business for sale would require a completely different approach than if the restructure was for growth. Whatever the reason for a restructure, legal advice is essential as restructuring can throw up many legal issues that need to be navigated correctly, so the company isn't left exposed.

Legal issues that can arise from a restructure include:

• Redundancies and/or TUPE
• Obligations to shareholders and investors
• Restructuring finance and debt

At Stephensons, our commercial solicitors can offer bespoke legal advice and guidance on business restructuring that will help improve your organisation. We are also specialists when it comes to restructuring for a business sale. Call us today on 0161 696 6229.

Restructuring to sell a business

At Stephensons, our expert company restructuring solicitors specialise in restructuring for a business sale. Preparing your business for sale is not an easy task and can take a year or two to implement, because, as a company, you will need to take an overall look at the health of your business and do your due diligence. The key areas to look at when you are thinking of restructuring your business for sale include:

• IT infrastructure
• Your business strategy
• Finances

A buyer will want to see healthy accounts that are clear and a coherent streamlined business strategy that is ambitious, yet realistic. Buyers may also be put off if they need to make a considerable investment in IT equipment and this may mean you need to invest in new infrastructure and initiate new procedures. A new IT restructure may lead to improvements in efficiency and productivity; however, this may mean you need to employ fewer people and redundancies may become inevitable.

Our corporate solicitors can advise you on whether your business would benefit from a restructure if you and your team are looking to sell the company. For more information on how we can help to prepare your business for sale contact us today on 0161 696 6229.

Recent case example

Our client undertook a group restructuring to streamline ownership and attract new investors. The restructuring involved a share-for-share exchange, consolidating the group’s assets under a single holding entity. New shares were issued, and existing shares were reclassified to accommodate both the client’s original shareholders and incoming shareholders. A comprehensive shareholders' agreement was crafted to define the rights and obligations of all parties, including governance provisions, rights of first refusal, and exit mechanisms. This restructuring allowed for improved operational efficiency and clearly defined shareholder relationships, setting the foundation for future growth.