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Basic Guidelines for Corporate Restructuring

Corporate restructuring provides a great alternative strategic direction to the financially distressed companies in order to continue operating as a business entity. Spinoffs, mergers and acquisitions all can be very useful for the company’s future when executed at the right time; and with the proper research, corporate restructuring can provide your company great profitable opportunities as well as increase the shareholder value. You can call virtual CFO for help whenever you plan to take your business in a new direction. The following guidelines will generally make the entire process of corporate restructuring a less risky and more beneficial.

Be Prepared to Get Expert Advice

Corporate restructuring is like the science of effectively driving your company through a major significant change. Whether it’s about turning into a flat organizational structure, removing underachieving divisions, enhancing the production activities, merging with another business you should always have an edge of benefiting from the professional knowledge and opinion of virtual CFOs, legal advisors and noticing agents. They have an experience in dealing with complexities of the business and would drive the change in a more desirable way with less resistance.

Watch Out for the Right Time

Executing the restructuring process at the right time is of utmost importance. With proper strategic planning and swift execution, companies can achieve their targets in a relatively better way. Authorities in the restructuring industry and SEC can provide companies knowledgeable information about the restructuring process and the legal formalities that need to be complied with.

Efficiently Organize Information

Before you seek assistance from virtual CFO or other experts, make sure you have all the relevant information available. This includes the financial data such as the financial statements of the company, its key performance indicators, financial ratios; and the non-financial data such as the segment-wise details of the production, costs and revenue. You should also have shareholder and employee listings, relevant contractual obligations to fulfill, vendor and customers list and so on. Have all the information easily accessible.

Provide all the Relevant Disclosures for Transparency

Keep in mind that you should be transparent in all your communications after evaluating their strategic relevance. Draft a communication strategy and regularly communicate the status of the restructuring process to those involves, those affected, and all relevant constituencies.

Be Sensitive and Reassuring to the Stakeholders

Stakeholders should never be disappointed with your corporate restructuring strategy. If any conflicts arise, deal with them carefully. Negotiate with the stakeholders and reassure them that the matter is being considered and their interest is being kept in consideration.