Abstract
A predominant interest of a company's shareholders is maximizing the value of their shares. This interest is at risk in financial distress, a situation in which the financial conditions of a company have deteriorated to a degree where it is unlikely to remain in business without adequate restructuring measures. Free (out-of- court) restructuring is subject to time limits as imposed by the German Insolvency Code. It postulates that at a certain point in time—marked by the triggers of either illiquidity or over-indebtedness—mandatory insolvency proceedings must be initiated in order to prevent further deterioration of company value and thereby protect creditors' claims. Optionally, the company can choose to file for insolvency earlier in case of threatening illiquidity.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2014 Springer Fachmedien Wiesbaden
About this chapter
Cite this chapter
Drescher, F. (2014). Introduction. In: Insolvency Timing and Managerial Decision-Making. Springer Gabler, Wiesbaden. https://doi.org/10.1007/978-3-658-02819-0_1
Download citation
DOI: https://doi.org/10.1007/978-3-658-02819-0_1
Published:
Publisher Name: Springer Gabler, Wiesbaden
Print ISBN: 978-3-658-02818-3
Online ISBN: 978-3-658-02819-0
eBook Packages: Business and EconomicsBusiness and Management (R0)