Published on : 22 October 20213 min reading time
The case of a company in difficulty
A company is considered to be in difficulty when its liabilities exceed its assets and it is in default of payment. As a result, the manager may consider putting it up for sale. Thus, a person or a company wishing to take over the company can follow the classical procedure in this matter; that is to say, determine its needs, analyze if the company in question is suitable for its expectations, talk to the seller and make an offer. The only difference with a normal takeover is that time is not on the buyer’s side. Otherwise, if the buyer takes too long to develop his recovery plan and to present his offer, the company may end up in bankruptcy proceedings.
The case of a company under collective procedure
A company resale is often ignored until it is entrusted to the judicial services. Of course, it is always possible to take over the company at a reduced cost; but the buyer is obliged to present a takeover file to the competent court. In this file, he must present a well-developed recovery plan, with concrete and feasible goals; without forgetting that each idea must be supported and argued with figures. But to obtain validation, it is also essential that the applicant is able to prove the presence of financial partnerships in his takeover project. And of course, the time for this is really limited.
Positive and negative points of the takeover
You may ask yourself why take over a company in difficulty? There are many advantages, including the lower cost. But also, in case of takeover of a company under judicial procedure, you have to know that the buyer is not responsible for the debts contracted by the seller. Moreover, he does not benefit from any guarantee as in a classic takeover; and he does not even have the right to act against the transferor. It is for all these reasons that it is advisable to hire an expert in such situations.