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Given that filing for bankruptcy is a difficult process, distressed businesses considering the alternatives should get as many people in line with the idea as early as possible, Andre Zafrani, ’01, told members of the Turnaround Management Association (TMA) on February 22.
The senior associate at Greenberg Traurig was one of six panelists offering insight at the TMA Chicago/Midwest chapter’s career forum. Faced with a case study involving a hypothetical company, other panelists called for prioritizing a work plan for the company’s management; getting the story straight for employees, vendors, customers, and lenders; or identifying the best ways to triage the situation in the short term. Zafrani, however, focused on being prepared for a possible bankruptcy filing.
Asked when his services might be enlisted to assist the struggling company Zafrani said it should be relatively early on. Hopefully it wouldn’t be too long before the capable financial advisors called in a team of lawyers and tucked them away in a back room, where we belong, to prepare the company on a parallel path for a bankruptcy filing of some kind, so that if things go from bad to worse the company is prepared to take advantage of the advantages that the bankruptcy code affords it.
A successful filing is more likely, he continued, when a company brings together its many constituents in support of a common objective, whether it is immersed in the Chapter Eleven process or putting together a pre-packaged or pre-negotiated bankruptcy plan. You try to get as many people on your side as possible, prior to the filing, so that it makes the process easier, he said.
Jenn Goddu