A customer who is waiting for his money to be paid out has submitted a bankruptcy plea for Cinkciarz.pl at the court in Zielona Góra. This decision was caused by an unsuccessful intervention of a bailiff. In this situation, is a bankruptcy petition a good way to recover money? Przemysław Furmanek of Lege Restrukturyzacje law firm comments on the matter.
In general, a company’s restructuring – the debtor’s one is definitely a better solution for creditors than its bankruptcy. In bankruptcy proceedings, the level of creditors’ satisfaction is often low – 1-20 percent. On the other hand, within the framework of restructuring, a deal can be expected that assumes repayment of at least half of the obligations.
The recovery proceedings will be a very good solution for Cinkciarz.pl. Apart from debt restructuring, it provides an opportunity to deprive the current authorities of the management over the company and to appoint a restructuring advisor in their place. The recovery proceedings promote agreement with creditors while providing external oversight over the company’s situation by the entire body of creditors.
Recovery proceedings usually increase the chances of debt repayment. Unlike bankruptcy proceedings, it is not solely based on the sale of the company’s assets or the entire enterprise. It also aims to continue operating the indebted company, so that the current income can be used to pay creditors.
Given the reputation of Cinkciarz.pl and the scale of its operations, alternative solutions to bankruptcy should be considered. The company, which recently sponsored the Polish national football team, could benefit from restructuring under the supervision of a manager and the court. Such a solution would allow the company to continue operating and increase the chances of a better repayment of creditors compared to liquidation sale of assets.
Przemysław Furmanek – Lege Restrukturyzacje law firm
Source: https://ceo.com.pl/cinkciarz-pl-czy-upadlosc-to-dobre-rozwiazanie-dla-wierzycieli-76793
