Germany: Financial Restructuring

CEOs and their executive teams face a critical misalignment in assessing market pressures, creating governance challenges that demand a fundamental rethinking of portfolio management. This article examines why the traditional sequential approach to evaluating underperforming business units destroys value and presents a concurrent decision framework that treats fix, sell, and close options as simultaneous strategic choices rather than a process of elimination.

The European Union has formally adopted a directive establishing minimum standards for insolvency law harmonization across Member States, covering avoidance actions, asset tracing, pre-pack proceedings, director filing duties, creditors' committees, and transparency measures. While the directive sets baseline requirements in these critical areas, its practical impact on German insolvency law is expected to be limited, as Germany's existing framework already meets or exceeds most of the directive's standards

The acquisition of assets or business operations out of insolvency proceedings presents distinct legal challenges under German law, particularly regarding the automatic transfer of employment relationships. The "acquirer concept" (Erwerberkonzept) offers a legally reliable solution that enables workforce restructuring while avoiding prohibited terminations based solely on the transfer of operations.

Alvarez & Marsal's Restructuring team hosted a webinar, where we presented findings from our latest EMEA A&M Distress Alert and discussed the key developments in the distressed and restructuring market in 2025.

Frankfurt Regional Court declines to recognize the effect of Projekt Fürst's restructuring plan, but this should not impact the recognition of English Schemes of Arrangement.

In this alert, we consider the recent judgment of the Frankfurt court declining to recognize the effects of the Aggregate group's 2024...

After many had proclaimed the German StaRUG to have failed as an effective preventive restructuring regime, there appears to have been a recent increase in cases.

PE transactions are special in many ways, including deal structuring and financing, tax-optimization as well as entrepreneurial and operational concepts post-closing.

The Management Board (der Vorstand) must initiate appropriate means and measures to recognize any damaging developments that might threaten the survival of the company.