GLOBAL RESTRUCTURING TRENDS - SEPTEMBER 2020 PWC.CO.UKSERVICES/BUSINESS-RESTRUCTURING #ACTNOWTORECOVER
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Global Restructuring Trends September 2020 pwc.co.uk/services/business-restructuring #ActNowToRecover
Contents
Restructuring Trends: Ireland 24 Appendix 45
A Global View
Italy 25 Trends per
Executive Summary 01 country 46
Japan 26
Key Themes 02
Malaysia 27
Act Now to Recover 07
Middle East 28
The Netherlands 29
Themes by countries and regions
New Zealand 30
Australia 08 Norway 31
Austria 09 Philippines 32
Belgium 10 Portugal 33
Brazil 11 Russia 34
Canada 12 Singapore 35
Cayman and British Virgin Islands 13 South Africa 36
Central and Eastern Europe 14 South Korea 37
China 15 Spain 38
Denmark 16 Sweden 39
East Africa 17 Switzerland 40
Finland 18 Taiwan 41
France 19 Turkey 42
Germany 20 United Kingdom 43
Greece 21 USA 44
Hong Kong 22
India 23
Global Restructuring Trends | PwC
When facing
uncertainty, decisive
action counts.
In the face of continued uncertainty, the latest global restructuring trends explored in this
report underline the vital importance of proactive and decisive action by corporates and
restructuring practitioners.
Getting on the front foot will not only stabilise – we just don’t know how long it will be before
businesses in the short-term, but also help them pre-pandemic levels of output are restored. It is
gear up for longer term shifts in technology, therefore vital to take the initiative now – when We explore the
customer expectations and international trading facing adversity, decisive action counts. For business
arrangements. Conversely, waiting until the lifeline recovery plans to be successful, businesses need to challenges and
of government support is withdrawn could be clear about the challenges in their path and how
significantly reduce the options available and to steer through them. Some of the challenges are
public policy
increase business vulnerability. immediately obvious. Others may be harder to responses that
foresee and potentially the most critical. This isn’t are shaping
The world continues to grapple with the most just about surviving, but also maintaining control of market activity in
serious global health emergency for a generation. the business, preparing for the future and ultimately
And with lockdown, social distancing and 37 economies
thriving in the long-term.
restrictions on the movement of goods and people worldwide.
has come severe economic upheaval. As we explore in Where Next, a series of papers
looking at how COVID-19 is affecting different
As governments strive to sustain businesses and
industries and how organisations can transform to
save jobs, policy measures continue to evolve in
meet the challenges, the pandemic is accelerating
rapid and often unpredictable ways. In the first
change and providing a catalyst for innovation and
phases of the novel coronavirus (COVID-19)
operational modernisation. Prominent examples
pandemic, businesses across the world were mainly
range from the shift to digital retail to moves towards
focused on stabilising liquidity and tackling cash
a more sustainable economy. As part of a deals-led
flow erosion. Even as economies reopen, the
recovery, the plentiful dry powder ready for
trajectories of both infection rates and business
investment by private equity is set to play a key role
recovery remain uncertain. To date, both insolvency
in enabling businesses to keep pace with fast-
rates and pressure to restructure have generally
changing customer demand and seize the
been held in check by government intervention. Yet
opportunities ahead.
these lifelines are now beginning to be wound up.
Few would doubt that we’re entering a make or In order for companies to navigate the complex
break period, with businesses facing hard challenges their organisation may face and mantain
choices ahead. control, we believe that it’s important to focus on
four critical areas: operations (e.g. cost
In this, the third edition of PwC’s Restructuring
competitiveness), liquidity and cash, financial
Trends: A Global View, we explore the business
restructuring and stakeholder management
challenges and public policy responses that are
(customers, employees and suppliers, as well as
shaping market activity in 37 economies worldwide.
financial stakeholders) and strategic mechanisms
The report draws on the expert local insights of our
(e.g. consolidation or divestment of non-core
restructuring advisers and insolvency practitioners,
assets). Like the wheels on a car, each needs to be
who outline how governments and businesses have
in good working order and closely aligned to move
responded to the economic upheaval, how they
the vehicle forward.
expect the next 12 months to play out and the
priorities for restructuring ahead. If you have any queries or would like to discuss
any of the issues highlighted in more detail, please
What comes through strongly from our analysis as
feel free to get in touch with one of our local
explored later in our report is that businesses can
contacts listed in the report.
no longer rely on the cushion of government
subsidies or suspension of debt obligations. Neither
can they afford to wait for recovery to take its course
1 | Global Restructuring Trends | PwC Data sources are available on page 49
Key themes
Government support Restructuring activity Insolvency moves back
holds back insolvency is set to pick up in Q4 onto the agenda
and restructuring 2020 or Q1 2021 Insolvency activity has been curtailed
activity, for now As government support is withdrawn,
through much of Q2 2020 and Q3
2020, largely as a result of
we expect restructuring activity to
As revenues dried up and cash calls government support and restrictions
pick up. The immediate priorities will
became harder and harder to meet, on legal action. There are a few
include repairing the balance sheet
government intervention has provided exceptions to this, particularly for
and dealing with the debts
a vital lifeline for many businesses, territories with debtor in possession
accumulated during lockdown. With
even ones that had previously been processes. The USA is the most
revenues subdued and margins
strong and well-resourced. Support obvious one, as Chapter 11 provides
tight, there will also be pressure on
includes loan guarantees and wage the framework and protection to help
businesses to eliminate waste, drive
subsidies for workers put on short- with restructuring of operations, and
down costs and refocus resources
time or furlough (more than 40 million more companies have harnessed it as
on growth.
workers are on furlough in the 37 a tool to get through the emergency.
economies we cover in this report). We have also noted increasing levels We have also seen a similar trend in
Governments have also offered tax of non-performing loans in territories Canada where, whilst insolvencies
holidays and moratoria on such as Italy, Portugal, Greece and have been decreasing, corporate
insolvency action. East Africa which will drive lender led restructuring under Canada’s
restructuring activity in the coming debtor-led restructuring statute saw
This support held down insolvency a significant increase in the first
months, as banks look to dispose of
rates during the critical initial months half of 2020.
these portfolios or outsource the
of the crisis (Q2 2020 rates fell across
management of these.
many markets compared to Q2 2019). In general, insolvencies are expected
It would also appear to have eased to increase in Q4 2020 and into 2021,
the pressure to restructure and turn especially for those companies that
around troubled businesses, including operate in heavily COVID-19-affected
those that were struggling before industries that may take much longer
COVID-19. But governments can only to recover (e.g. leisure, travel,
afford to foot the bills for so long. hospitality, tourism, accommodation,
retail etc), as well as for those that
have yet to adapt their operations to
the new environment.
2 | Global Restructuring Trends | PwC Data sources are available on page 49
Government support Level of funding as a percentage of 2019 GDP as at August 2020 Canada 14.3% China 4.6% France 5.6% Germany 12.5% Hong Kong 10.0% Italy 4.5% Japan 42.2% Russia 3.4% United Kingdom 4.0% USA 13.9% Percentage of the national workforce on furlough as at July 2020 Canada 15.9% France 32.6% Germany 18.7% Italy 45.2% Japan 6.2% United Kingdom 31.5% USA 0.1% Note: A complete circle would represent 100% Note: No furlough data available for China, Hong Kong and Russia Note: Graphs present the G8 countries plus China and Hong Kong 3 | Global Restructuring Trends | PwC Data sources are available on page 49
-15% to -10%
-10% to -5%
-5% to 0%
0% to 5%
Pressure on GDP underlines the need to adapt
2020 Real GDP YoY now and future-proof the business for the
variation (%) shifts ahead
International Monetary Fund (IMF) projections anticipate that the
Canada Italy contraction in GDP stemming from the COVID-19 pandemic will be more
(8.4)% (12.8)% marked than the Global Financial Crisis of 2008-09 in all but a few
markets. Unemployment could also be higher, rising significantly towards
the end of 2020 as government support schemes are scaled back.
China Japan
1.2% (5.8)% The trajectory and duration of economic recovery in 2021 are still
uncertain, and are likely to vary by market and sector. Much hinges on
both a medical solution to the virus and companies’ ability to adapt to the
France Russia new environment. Further drivers of demand and growth include people’s
(12.5)% (6.6)% comfort with, and ability to, travel.
The key focal points for the coming round of restructuring include
Germany United repairing the balance sheet and creating the foundation of a healthy
(7.8)% Kingdom medium-to long-term recovery. Crucially, there will be opportunities to
make the most of rapidly developing restructuring regimes, which
(10.2)% provide new tools to work through the issues created by the crisis. These
Hong Kong include new legislation implemented or pending in the UK, Netherlands,
(4.8)% USA
Singapore, Middle East and the Cayman Islands.
(8.0)% In particular, where these regimes are more debtor friendly we expect to
see increased levels of activity as more corporates harness these tools to
get through the crisis as is the case already in the US and Canada.
Note: Map presents the G8 countries plus China and Hong Kong
4 | Global Restructuring Trends | PwC Data sources are available on page 49
Private Markets Dry Powder ($bn)
The pandemic looks set to
accelerate longer term shifts in the
economy. This ranges from the
move to digital retail to
strengthening sustainability.
Corporate restructuring is set to
play a key role in helping businesses
to boost strategic agility and future-
proof their business models by
simplifying their structures, clearing
away non-core operations and
freeing up funds for investment.
Undeployed capital in private equity
and debt funds is at an all-time high,
significantly above the levels
available during the Global Financial
Crisis, creating a launchpad for a
fast acceleration in deals and market
recoveries. An increasing number
of companies have been able to
raise new financing without
significantly compromising existing
debts, and thereby avoided lengthy
restructuring processes.
For sources of the data presented in this report, please see page 49 at end of the report.Vestibulum venenatis eget odio quis
molestie.
5 | Global Restructuring Trends | PwC Data sources are available on page 49
Insolvency appointments
Canada China France
Germany Hong Kong Italy
Japan Russia United Kingdom
USA
Note: Q2 2020 figures for Germany,
France and Russia not included as data
was not available
Note: Graphs present the G8 countries
plus China and Hong Kong
6 | Global Restructuring Trends | PwC Data sources are available on page 49
Act now to recover
What then can you do now?
The crunch is coming for We believe that there are three key priorities:
troubled companies. Even
1. Determine what shape the business is in
those in reasonably good
The ‘health check’ should look at both the immediate
health now face fundamental state of the business and its longer term prospects.
What are the immediate threats? How is the company’s
changes ahead. As a creditor, competitive environment changing and how fit is it to
keep pace? What are the opportunities and how
sponsor or other stakeholder can the business capitalise? Is management on the
right track?
with a financial interest in a Even with the current uncertainty, there is a great deal
that can be determined by getting down to the detail in
company, how much longer areas such as customer demands, competition, supply
chains and access to investment. This not only
can you therefore afford to requires restructuring expertise, but also insights
into sector trends and how to respond, both locally
wait and see? and globally.
2. Clear the path to recovery
What is the path to recovery? What are management
The key message coming through from our Where Next teams doing to help accelerate progress? Do they have
industry perspectives is the extent to which COVID-19 has the capability to deliver the operational changes or
not only created severe strains for many businesses in the transactions required? Depending on the state of the
short-term, but also accelerated shifts in what customers business and its prospects, potential support ranges
expect and how businesses compete. Drivers of disruption from helping to shore up liquidity to divestitures, debt
and change stretch from the onward march of digitisation restructuring and facilitating access to fresh capital.
to demands for greater sustainability and social inclusion.
For the management and shareholders in the driving seat,
the shifts underline the need for plans that don’t just 3. Work through divergent interests
assume that everything will get back to where they were
Key questions include both when to step in and how.
before the pandemic, but actively prepare for the new
Sponsors may have different priorities from creditors.
environment. Wait too long and it may be too late.
Management may be wary or resistant to intervention.
Yet what does this all mean for you as one of the Different creditor groups may have different rights and
stakeholders that aren’t in the driving seat, but still have a leverage. Yet, by establishing a close relationship when
significant interest in the health and prospects of the the business is still viable rather than facing insolvency,
business? Rightly, you have offered space and support as parties have the opportunity to work effectively
businesses have sought to stabilise and stay afloat. But together to secure a better deal.
with furlough and other government lifelines being
withdrawn, the need to determine whether the business is
viable now and equipped for the changes ahead is
becoming ever more pressing. You might argue that the
trajectory of recovery is too uncertain to know whether the
business has a future and what steps are needed to
optimise its prospects. But if you do nothing, you might
find that the only option is the last resort of insolvency and
a consequential loss of value. Acting decisively now could
not only avert this, but also ensure that the business is in
the best shape to survive and thrive.
7 | Global Restructuring Trends | PwC Data sources are available on page 49
Australia
$1,393 12.3% 24.7%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
1.9% (4.5)% 4.0%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
5.6%
Unemployment | 2009
7.6%
Unemployment | 2020
8.9%
Unemployment | 2021
Australia is facing its first recession in nearly 30 years restructuring and insolvency activity to pick-up in
as a result of COVID-19. However, insolvency activity 2021 as the bulk of government support is scaled back.
has remained at historic lows. This reflects unprecedented Clearly some sectors are likely to face ongoing challenges,
levels of support for business from both the public and especially those where demand is driven by people coming
private sectors. from abroad such as the travel and tourism, tertiary
education, as well as accommodation and hospitality.
A combination of economic stimulus, the temporary
suspension of company directors’ obligations to avoid Restructuring will focus on stabilising balance sheets,
trading whilst insolvent, a moratorium on winding-up while accelerating digital transformation and reallocation
petitions and a strategic withdrawal from enforcement of resources to fast recovery and growth areas.
action by tax authorities has allowed many otherwise
‘challenged businesses’ to avoid insolvency. PwC Local contact: Stephen Longley
Restructuring activity has also remained subdued. stephen.longley@pwc.com
Many listed companies affected by the pandemic moved
quickly to raise fresh equity in March and April. Lenders +61 3 8603 3203
have also provided significant accommodation to
distressed companies in the form of covenant waivers
and principle and interest deferrals. We expect
Insolvency appointments
Note: Q2 2020 excludes June insolvency data
8 | Global Restructuring Trends | PwC Data sources are available on page 49Austria
$446 12.6% 36.8%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(3.8)% (7.0)% 4.5%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
5.3%
Unemployment | 2009
5.5%
Unemployment | 2020
5.0%
Unemployment | 2021
In 2020, Austria’s GDP is expected to decline more sharply Despite the extension of government labour subsidies until
than during the Global Financial Crisis. While the current March 2021, we expect that the level of restructuring and
recession looks set to be short-lived, GDP is unlikely insolvency activity will increase in the remainder of 2020
to return to its pre-pandemic level by the end of 2021. and into the first half of 2021. It is clear that companies that
were already facing financial difficulties at the beginning of
Corporate insolvencies fell significantly in the first half 2020, along with those in fast-changing sectors such as
of 2020, largely due to government subsidies (liquidity retail, travel and tourism and manufacturing, are likely to
improvement actions, government-backed loans and face challenging market conditions.
short-time working). The fall also stems from new
insolvency legislation, which eliminates the over This underlines the importance of restructuring businesses
indebtedness-test until the end of Q3 2020. for long-term viability as well as near-term survival.
The main focus for businesses has been on crisis
management, securing liquidity and cost reductions.
PwC Local contact: Manfred Kvasnicka
The economic challenges have led to a rise in
unemployment. A number of initiatives to limit the manfred.kvasnicka@pwc.com
impact including short-time working have been
+43 1 501 88 29 37
introduced. We anticipate that the likelihood of an
economic recovery in 2021 will reduce the overall
impact on the employment market.
Insolvency appointments
9 | Global Restructuring Trends | PwC Data sources are available on page 49Belgium
$530 14.5% 22.5%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(2.0)% (6.9)% 4.6%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
7.9%
Unemployment | 2009
7.3%
Unemployment | 2020
6.8%
Unemployment | 2021
In 2020, the Belgian economy is expected to experience The insolvency moratorium introduced during the first
the largest annual decline in GDP since the Second World wave of the COVID-19 lockdown has held back
War. A return to 2019 GDP levels is expected to take insolvencies. However, we expect the number of
several years. insolvencies to increase. There have already been initial
signs of this in the last few months. It is worth noting that
To date, the largest element of the increase in activity is primarily focused on businesses that were
unemployment has been among temporary and contract already facing financial distress entering 2020, with a
workers. Companies have drawn on furlough schemes in number of retail companies being especially impacted.
an effort to conserve liquidity. As these support measures
are phased out, a significant increase in overall
unemployment is expected until 2022. PwC Local contact: Thomas Deryckere
It is clear that the focus is now on cost reduction thomas.deryckere@pwc.com
initiatives, having at the outset of the pandemic been
upon conserving liquidity. +32 474 78 04 59
Insolvency appointments
10 | Global Restructuring Trends | PwC Data sources are available on page 49Brazil
$1,840 11.8% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
0.1% (9.1)% 3.6%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
9.7%
Unemployment | 2009
14.7%
Unemployment | 2020
13.5%
Unemployment | 2021
Restructuring activity was limited in the first months to increase. Companies are also keen to put forward
of the pandemic. This is largely due to a combination viable business plans to support financial restructuring.
of government subsidies and greater flexibility in the
application of labour laws in areas such as reductions Pressure is coming from subdued consumer demand and
in working hours. rising unemployment. The temporary suspension of labour
regulations that has helped to protect jobs and prevent
The rapid moves by private banks to introduce covenant corporate failures also looks set to be phased out. In turn,
waivers and grace periods of between two-six months the government’s scope for further economic support may
for the payment of principal obligations contributed to the be curtailed by the pressure on public finances.
low levels of restructuring. With the end of these support
measures, we expect an increase in default rates.
As a result, banks have been raising their provisions PwC Local contact: Christine Savignon
for bad debt and increasing restrictions on new credit. christine.savignon@pwc.com
Estimates suggest that around 500,000 businesses
+55 11 3674 2710
had ceased to operate by June 2020, mainly small and
micro-enterprises. As we move into the second phase of
the economic emergency, we expect restructuring activity
Insolvency appointments
Note: No data available
11 | Global Restructuring Trends | PwC Data sources are available on page 49Canada
$1,736 14.3% 15.9%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(2.9)% (8.4)% 4.9%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
8.4%
Unemployment | 2009
7.5%
Unemployment | 2020
7.2%
Unemployment | 2021
Corporate insolvency dipped significantly in Q2 2020. A their normal operations, as well as whether further
number of government wage subsidies, tax deferral and waves of COVID-19-related shutdowns will be ordered.
loan programmes have given companies time to review
their position and consider their options. However, some We anticipate that restructuring and insolvency activity
of these programmes are expiring or are due to be will increase through the autumn of 2020, particularly
modified. In the main, lenders have provided support as companies adjust to the new normal and the impact
to troubled debtors. of COVID-19 is more fully realised. However, Canada has
not yet seen the wave of defaults that were widely
Corporate restructuring under Canada’s debtor-led anticipated, though lenders are preparing for many new
restructuring statute saw a significant increase in the first troubled debtors in the coming quarter.
half of 2020, with as many new cases in Q2 (38 filings)
as in all of 2019. Many of these companies were already The overhang of the recession and underlying structural
facing financial issues that were exacerbated by the impact changes in the economy will result in a slow return to
of lockdown, notably in the retail sector. The economic pre-pandemic levels of economic activity across several
impact of COVID-19 in Canada has been particularly industries, including retail, travel and tourism, and
profound in the oil and gas, manufacturing, retail trade manufacturing.
and construction sectors. The dip in economic activity
was compounded by a sharp drop in oil and gas prices. PwC Local contact: Greg Prince
It is clear that economic recovery will depend heavily gregory.n.prince@pwc.com
on how quickly companies and consumers resume
+1 416 814 5752
Insolvency appointments
12 | Global Restructuring Trends | PwC Data sources are available on page 49Cayman and British Virgin Islands
$5 13.2% 7.1%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(7.0)% (11.4)% 2.0%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
6.0%
Unemployment | 2009
11.6%
Unemployment | 2020
5.3%
Unemployment | 2021
The economies of the Cayman and British Virgin Islands liquidation process, whilst being afforded the benefits
(BVI) are dominated by tourism and hospitality and financial of a moratorium. We anticipate that this will increase
services. Tourism and hospitality have been severely restructurings substantially. In BVI, the Court has recently
affected by COVID-19-related travel restrictions. However, appointed its first ever ‘light touch’ provisional liquidator,
financial services (mainly fund and corporate activity) has similarly opening the door for substantially more financial
been buoyed by the stimulus packages put in place by restructuring processes in future.
governments worldwide.
Insolvencies have generally been subdued, though we’re PwC Local contact: Simon Conway
now seeing a steadily increasing flow of enquiries. We
anticipate a rise in fund redemptions and an increase in simon.r.conway@pwc.com
distressed insolvent scenarios into 2021, as national
+1 345 914 8688
governments start to withdraw economic support.
Restructuring activity is increasing as a number
of major corporate entities seek to restructure their
debts and avoid insolvency.
This trend is likely to continue into 2021. Legislation is
currently pending in the Cayman Islands, which will allow
debtors to appoint a restructuring officer, outside of a
Insolvency appointments
Note: No data available
13 | Global Restructuring Trends | PwC Data sources are available on page 49Central and Eastern Europe (CEE)
$2,262 5.4% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(3.0)% (5.0)% 4.8%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
9.0%
Unemployment | 2009
8.9%
Unemployment | 2020
7.6%
Unemployment | 2021
Insolvency activity has been subdued across the Central Looking ahead, we expect an uptick in restructuring activity
and Eastern Europe (CEE) region due to government across the CEE region in Q4 2020, once the institutional
measures introduced in response to COVID-19. support is ended.
These include a moratorium that has enabled banks
to adopt a collaborative approach with debtors. The key industries which remain under pressure in
The exception is Romania, which has recorded an the region are automotive, retail, tourism and hospitality.
increase in the number of insolvencies.
PwC Local contact: Petr Smutny
Restructuring activity has also remained generally
low across the region for the same reasons, though petr.smutny@pwc.com
the Czech Republic has seen an increasing trend.
+420 251 151 215
Businesses have mainly focused on preserving liquidity
by drawing on the government support structures, as
well as cost reduction and stabilisation of supply chains.
Insolvency appointments
Note: No data available
14 | Global Restructuring Trends | PwC Data sources are available on page 49China
$14,343 4.6% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
9.4% 1.2% 9.2%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
4.3%
Unemployment | 2009
4.3%
Unemployment | 2020
3.8%
Unemployment | 2021
China has seen a significant deceleration in growth Signs are that the government might not prevent the
in the wake of the COVID-19 pandemic. downturn of some companies. This will lead to an increase
in insolvency activity and put pressure on businesses to
Consumer spending fell by 1.38 trillion yuan (US$199.3bn) accelerate restructuring.
in the first two months of the year due to the severe
impact of the outbreak on restaurants, hotels, tourism, Industries such as financial services, public health and
entertainment and transportation sectors. In turn, the care sector are more likely to attract foreign direct
passenger car sales saw the biggest drop in nearly investment due to relief policies introduced recently.
two decades.
PwC Local contact: Victor Jong
Chinese regulators have introduced a series of measures to
ease the financial pressures on enterprises emanating from victor.yk.jong@cn.pwc.com
the pandemic. Financial policies are geared towards certain
industries such as medical and life supplies for pandemic +852 2289 5010
prevention, aviation, agricultural and green energy vehicles.
There is also tax relief to help ease cash flow or liquidity
issues. However, despite this support, the number of
insolvencies is still higher than the comparable last year.
Insolvency appointments
15 | Global Restructuring Trends | PwC Data sources are available on page 49Denmark
$348 5.8% 9.2%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(4.9)% (6.5)% 6.0%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
6.4%
Unemployment | 2009
6.5%
Unemployment | 2020
6.0%
Unemployment | 2021
The number of insolvencies dipped in the first half of 2020 The economic outlook in Denmark is uncertain. The Danish
despite the biggest quarterly drop in GDP in Q2 since the National Bank anticipates that recovery to pre-pandemic
Global Financial Crisis. levels of output could take several years. As Denmark is a
small and open exporting economy, it’s dependent on the
This is largely explained by government-funded relief global economy. We expect exporting companies and
initiatives such as postponement of VAT payments, salary businesses with foreign operations to be especially
compensation to furloughed employees and funding to affected by the current uncertainties. We also see an
cover pandemic-related losses. We also saw an expansion unusually high number of vacant leases in the retail sector,
of lending and guarantee capacity through state-financed and a low occupancy rate in hotels due to COVID-19.
lending entities. During lockdown, Danish courts were only
open for self-declaration of bankruptcy, which prevented We expect the support required in the near future will be
third-parties or creditors from filing. In addition, banks focused on securing financing to sustain operations. We
reported an unforeseen decrease in their lending activities, also expect restructuring support to increase, especially
due to the relief initiatives from the government. once the COVID-19 government measures are phased
out. We have also seen a focus on cash forecasting and
In line with global trends, the emphasis for businesses has working capital optimisation, and we believe this trend
been on crisis management, accessing liquidity and supply will continue in the near future.
chain resilience. The majority of the government funded
schemes are ending in Q3. We therefore expect to see an PwC Local contact: Mads Johansson
uptick in insolvency activity.
mads.johansson@pwc.com
+45 39 45 37 77
Insolvency appointments
16 | Global Restructuring Trends | PwC Data sources are available on page 49East Africa
$240 1.3% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
5.2% 0.8% 5.1%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
6.4%
Unemployment | 2009
8.6%
Unemployment | 2020
9.0%
Unemployment | 2021
The adverse impact of COVID-19 on East African Given the high leverage and widespread financial distress
businesses has been severe. The region’s economies have across East African businesses before the pandemic, these
limited capacity to absorb the resultant economic shocks, steps defer rather than resolve the problems.
and governments have limited ability to offer significant
stimulus and support. Conversely, insolvency activity has dipped. This is despite
the recent implementation of insolvency-related legal and
This impact is reflected in increasing levels of regulatory reforms in a number of regional markets, aimed
non-performing loans. While this would normally at making insolvency regimes ‘business rescue’ friendly.
have led to a surge in lender-driven insolvencies, central
banks are encouraging banks to favour restructuring We expect to see comprehensive restructuring of balance
instead. The result has been an unprecedented upsurge sheets as lenders take stock of their position and the
in the volume and value of restructured facilities. In Kenya, outlook for clients in the post-pandemic period.
for example, 29% of the total banking sector loan book
PwC Local contact: George Weru
was restructured between March and June 2020.
However, this mostly comes in the form of moratoriums george.weru@pwc.com
on debt service obligations and extension of tenor rather
than a comprehensive restructuring of balance sheets. +254 727 34 15 84
Insolvency appointments
Note: No data available
17 | Global Restructuring Trends | PwC Data sources are available on page 49Finland
$269 5.2% 7.4%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(8.1)% (6.0)% 3.1%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
8.3%
Unemployment | 2009
8.3%
Unemployment | 2020
8.4%
Unemployment | 2021
Insolvency activity in the first half of 2020 was down In line with global trends, the emphasis for businesses
from 12 month before. This is mainly due to government has been on crisis management, accessing liquidity,
moves to expand lending and guarantee capacity to supply chain resilience and rent re-negotiations.
SMEs, ensuring sufficient access to finance and reducing
the structural buffer requirements for the banking sector. We anticipate that, in the event of a renewed COVID-19
Access to capital has been gradually improving over outbreak followed by further lockdowns, there will
recent months. be a severe impact on SMEs. This contrasts with
larger companies, which are more dependent on
The government has also initiated targeted liquidity exports and global demand.
improvement actions for the most severely impacted
sectors, such as aviation and shipping. PwC Local contact: Michael Hardy
As a result of these initiatives, restructuring activity michael.hardy@pwc.com
has remained relatively quiet.
+358 20 7877442
Insolvency appointments
18 | Global Restructuring Trends | PwC Data sources are available on page 49France
$2,716 5.6% 32.6%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(2.9)% (12.5)% 7.3%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
9.1%
Unemployment | 2009
10.4%
Unemployment | 2020
10.4%
Unemployment | 2021
The impact of lockdown on the French economy has Furthermore, these economic difficulties could also spur
been compounded by the dent to important sectors the need for refinancing of some of the lending supported
such as aerospace, automotive and tourism. Government by the guarantee programme.
support to help viable companies to ride out the impact
has included loan guarantees to encourage bank lending. The government is currently transposing the 2019 EU
restructuring directive into law. This should improve the
As a result, restructuring activity has been focused prospects for secured creditors, relative to shareholders
on two factors. The first is shoring up the balance sheets and unsecured creditors. Some temporary measures have
of otherwise viable companies applying to the guarantee also been implemented to ease the restructuring processes
programme. The second is stabilising companies that had during the post-pandemic period. Examples include flexible
already faced difficulties before the pandemic, including access to asset deals for existing shareholders, in absence
some retail businesses affected by digital competition. of other credible options.
Over the next few months, we expect the number of PwC Local contact: Sébastien Dalle
companies in financial distress or bankruptcy to increase,
resulting from the relative weakness of the economic sebastien.dalle@pwc.com
rebound across many sectors.
+33 1 56 57 80 13
Insolvency appointments
Note: Q2 2020 excludes June insolvency data
19 | Global Restructuring Trends | PwC Data sources are available on page 49Germany
$3,486 12.5% 18.7%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(5.7)% (7.8)% 5.4%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
7.7%
Unemployment | 2009
3.9%
Unemployment | 2020
3.5%
Unemployment | 2021
The German economy faced significant headwinds We expect to see an increase in restructuring activity
from the outbreak of COVID-19 as a result of its reliance as government support is scaled back.
in exports. However, economic activity has begun to
slowly get back on track on the back of some €1.3tn The continuing impact of the pandemic is likely to spur
in government subsidies. The support includes tax restructuring within the automotive sector in particular.
reductions, furloughs and state aid in form of loans Alongside the near-term dent in consumer demand
and equity. stemming from the outbreak, carmakers face a longer-
term shift towards hybrid and fully electric vehicles.
Further relief has come from the temporary suspension
of the obligation to file for insolvency until the end of Furthermore, we expect to see increased restructuring
September 2020, with an option to extend this until the in challenged sectors such as retail, shipping and
end of March 2021. As a result, insolvency proceedings industrial manufacturing.
declined by nearly 10% in May 2020 compared to May
2019. Restructuring activity and default rates have also PwC Local contact: Daniel Judenhahn
been subdued due to government support. daniel.judenhahn@pwc.com
The main focus of businesses in the last months has
+49 69 9585 6976
been on accessing liquidity, crisis management and
supply chain stabilisation.
Insolvency appointments
Note: Q2 2020 excludes June insolvency data
20 | Global Restructuring Trends | PwC Data sources are available on page 49Greece
$210 12.8% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(4.3)% (10.0)% 5.1%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
9.6%
Unemployment | 2009
22.3%
Unemployment | 2020
19.0%
Unemployment | 2021
The impact of the COVID-19 pandemic has been A new Bankruptcy Code is about to come into effect (from
heightened by the importance of tourism to the Greek 2021) incorporating the EU restructuring directive. This will
economy (some 20% of GDP). Coordinated monetary, help to streamline bankruptcy processes, bring together
fiscal and regulatory support has helped to ease the restructuring regimes under one code and reduce the time
difficulties faced by businesses across the economy. to discharge. It will also usher in early warning mechanisms
and a truly out of court workout. as well as the digitisation
As a result, restructuring activity has been low in 2020 of procedures. We believe that the changes will make
so far. The winding down of government and bank restructuring, pre-insolvency procedures and bankruptcy
support, paired with the fact that servicers are taking more efficient.
over the majority of non-performing loans, will be
key drivers of increased restructuring activity over
PwC Local contact: Ioannis Theologitis
the next period.
ioannis.theologitis@pwc.com
+30 21 0687 4654
Insolvency appointments
Note: No data available
21 | Global Restructuring Trends | PwC Data sources are available on page 49Hong Kong
$366 10.0% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(2.5)% (4.8)% 3.9%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
5.2%
Unemployment | 2009
4.5%
Unemployment | 2020
3.9%
Unemployment | 2021
The government has supported business and jobs through We expect the hard-hit travel and aviation sectors to take
three rounds of funding totalling HKD288bn (US$37.1bn) longer to return to 2019 activity levels as the catalyst of
since the start of 2020. Moreover, in April, the Hong Kong lockdown changes people’s behaviour and priorities in the
Monetary Authority instructed all banks to grant a longer term. Accommodating these changes will require a
six-month loan repayment holiday to SMEs, which has significant rethink when it comes to liability management.
given respite to SMEs across a range of different sectors.
With economic strains continuing and new bank financing
As a result, insolvency activity has been relatively muted becoming more difficult and pricier to secure, we anticipate
this year, with only 62 compulsory winding up orders this that the number of insolvencies may go up in Q4 2020 or
year compared with 126 for the comparable period last early next year. Businesses and lenders are unable to hold
year. The lower numbers may also be attributable to the out indefinitely despite the government measures.
impact of COVID-19 on court operations.
PwC Local contact: Peter Greaves
Nonetheless, many businesses, especially those in the
consumer and retail industries, have faced significant peter.greaves@hk.pwc.com
liquidity issues, requiring them to focus on reducing their
highest outgoings – typically rental expense and +852 2289 1826
employee wages.
Insolvency appointments
22 | Global Restructuring Trends | PwC Data sources are available on page 49India
$2,876 7.0% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
8.5% (4.5)% 6.0%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
5.6%
Unemployment | 2009
11.0%
Unemployment | 2020
9.8%
Unemployment | 2021
Insolvency rates have been held in check by government adjust loan arrangements in sectors under stress.
and regulatory intervention.
While unemployment rose initially, it has started to fall as
Recent regulatory action includes an increase in the businesses come out of lockdown. Business sentiment is
threshold for invoking proceedings, inclusion of a special also encouraging. PwC research has found that more than
insolvency resolution framework for SMEs and a 80% of businesses are confident that the economy can
moratorium on fresh initiation of proceedings for six return to the pre-pandemic levels by June 2021. The
months. The Reserve Bank of India (RBI) has also research underlines the importance of getting on
introduced a Resolution Framework for COVID-19 Related the front foot in seeking to restructure businesses and
Stress, which aims to revive real estate sector activities and boost viability. Respondents in our survey attribute their
mitigate the impact of financial stress on borrowers. resilience in the face of stress and confidence in their
ability to rebound to operational flexibility, robust crisis
Business agenda is primarily focused on maintaining the management and effective process/product innovation.
debt-equity ratio, reviving demand and optimising cost
management. In turn, the government has been focusing
closely on credit availability, resource utilisation and PwC Local contact: Dinesh Arora
entrepreneurship. Further interventions include the RBI
dinesh.arora@pwc.com
prudential norms, which grant banks a one-off window to
+91 98 10 19 12 91
Insolvency appointments
Note: No data available for Q2 2020
23 | Global Restructuring Trends | PwC Data sources are available on page 49Ireland
$389 7.1% 18.8%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(5.1)% (6.8)% 6.3%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
12.6%
Unemployment | 2009
12.1%
Unemployment | 2020
7.9%
Unemployment | 2021
Restructuring activity in Ireland has remained relatively to the direct impacts of COVID-19 when assessing
subdued. The insolvency rate in the first half of 2020 was if a director acted recklessly when trading while insolvent
down by around 30% compared to the same period in on the basis they act in good faith and responsibly.
2019. Contributing factors include payment breaks for New temporary insolvency legislation is being introduced.
borrowers, together with the impact of government support The most notable changes are to extend the examinership
schemes. The acid test of viability for businesses will come period by a further 50 days if required, permit remote/
when the government aid is withdrawn. virtual creditor meetings and an increase the winding
up debt threshold to €50,000.
A key focus for businesses has been the renegotiation
of leases and the granting of forbearance. This has led We expect large multinational businesses to bounce back
to some high-profile disputes between landlords and their quickly, but the SME sector will take a number of years to
tenants. There have already been a number of liquidations recover. A lot of SMEs are already highly leveraged from
in the retail sector, driven primarily by administrations and the last downturn. They will therefore require some form of
downsizing of UK-parent companies whose difficulties restructuring, refinancing and/or change of management in
were accelerated in the COVID-19 lockdown. order to survive. Schemes such as the recently introduced
State Credit Guarantee for 80% of borrowings will be
There is likely to be an increase in restructuring and crucial to the survival of these businesses, which are the
insolvency activity in the first half of 2021. The Office of the lifeblood of the Irish economy.
Director of Corporate Enforcement issued guidance, and
some comfort, to directors that they would give due regard PwC Local contact: Declan McDonald
declan.mcdonald@pwc.com
Insolvency appointments
+353 1 792 6092
24 | Global Restructuring Trends | PwC Data sources are available on page 49Italy
$2,001 4.5% 45.2%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(5.3)% (12.8)% 6.3%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
7.7%
Unemployment | 2009
12.7%
Unemployment | 2020
10.5%
Unemployment | 2021
Restructuring and insolvency activity was relatively A significant increase in new insolvency and restructuring
quiet in the first half of 2020 as a result of emergency is expected in the first quarter of 2021, once the existing
legislation and generally supportive approach of banks support measures have ceased. In the case of distressed
and creditors. This includes the option to suspend companies, there may be the need for capital restructuring.
payments for 6-12 months.
In both cases, investors could play a significant role,
The gathering recovery of the economy is expected with the Italian banking system involved in a new wave
to continue in the coming months. Confidence has of de-risking (through the disposal of non-performing
continued to improve in all sectors. loan portfolios and single names, as well as outsourcing
of their management to dedicated platform). Recent deal
Stronger companies have found it relatively easy activity also suggests that there is likely to be further
to access bank finance. Loans are secured by government consolidation among TIER-2 banks.
guarantees to cover losses and support short-term cash
needs. However, businesses that took advantage of last
PwC Local contact: Michele Peduzzi
year’s government-backed debt restructuring measures
have generally not been able to benefit from the current michele.peduzzi@pwc.com
guarantees. As a result, they may need to re-open
discussions with banks and look for solutions without +39 02 8064 6371
government support.
Insolvency appointments
25 | Global Restructuring Trends | PwC Data sources are available on page 49Japan
$5,082 42.2% 6.2%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(5.4)% (5.8)% 2.4%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
5.1%
Unemployment | 2009
3.0%
Unemployment | 2020
2.3%
Unemployment | 2021
While GDP has fallen, the number of insolvencies has Other than COVID-19 related developments, there are
not increased, and the rate of unemployment has been likely to be more opportunities for business restructuring.
stable. Since the Global Financial Crisis, Japanese These include portfolio reorganisation, operational
companies have been improving their level of cash restructuring and divestments in Japanese corporations.
and shareholder equity. This is due, in part, to track record of growth in
conglomerates, sometimes retaining unprofitable
In response to the pandemic, the government and non-core businesses. Furthermore, we expect to see a
banks coordinated moves to bolster liquidity and help consolidation of the banking system, as smaller regional
corporations to protect their cash positions. Further banks have been affected by a slow economic recovery
steps include a government scheme to support SMEs, and poor interest rates. The government appears open to
with funding equivalent to more than 20% of 2019 GDP. supporting any regulatory reform required to enable the
Some specific sectors (e.g. automotive, auto-parts, consolidation process.
hospitality & leisure, retail & consumer) have been
PwC Local contact: Kiwamu Sugimoto
heavily disrupted by the COVID-19 outbreak and have
yet to recover. Consequently, if the COVID-19 outbreak kiwamu.k.sugimoto@pwc.com
continues or there is a renewed surge in cases, there
is likely to be more restructuring. +81 80 3519 9482
Insolvency appointments
26 | Global Restructuring Trends | PwC Data sources are available on page 49Malaysia
$365 4.2% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(1.5)% (1.7)% 9.0%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
3.7%
Unemployment | 2009
4.9%
Unemployment | 2020
3.4%
Unemployment | 2021
To protect jobs and stimulate the economy, the Central PwC Local contact: Victor Saw
Bank of Malaysia initiated an automatic moratorium
on all loan/financing, payments, principal and interest victor.saw.seng.kee@pwc.com
by individuals and SME borrowers for a period of six
+60 3 2173 1677
months from 1 April 2020. The moratorium was further
extended for three months to those who are directly
impacted by the pandemic.
Insolvency activity has been subdued due to various
initiatives by the government to protect companies against
collapse. This has given the businesses disrupted by the
pandemic some lifelines. However, we anticipate insolvency
activity to pick up in 2021. Especially on highly geared
companies when the government pulls the brake on
existing support measures
Insolvency appointments
Note: No data available for Q1 2020 and Q2 2020
27 | Global Restructuring Trends | PwC Data sources are available on page 49Middle East
$2,692 3.1% N/A
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
0.5% (4.5)% 3.7%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
6.9%
Unemployment | 2009
10.9%
Unemployment | 2020
9.0%
Unemployment | 2021
Liquidity has come under pressure following the decline in pandemic demands a more holistic solution for borrowers
oil prices and the COVID-19 pandemic. In 2020 there have who have taken advantage of these schemes.
already been a number of high profile corporate collapses
in the region. Widespread legislative changes in the bankruptcy
and restructuring frameworks of most major regional
A combination of government support and initiatives jurisdictions could support distressed businesses in
have so far helped to delay more widespread defaults. restructurings and also provide alternative options for
For example, the UAE Central Bank has issued directives creditors. In 2020, there has already been a number of
to offer relief measures to banks, corporates and long running and high profile cases put forward under the
individuals within the country and implemented the new Kingdom of Saudi Arabia bankruptcy law where there
Targeted Economic Support Scheme (TESS), to support are now over 500 cases in total. Earlier in the year in the
banks in providing relief to corporate borrowers. The TESS UAE, the Financial Reorganisation Committee accepted
scheme is currently due to expire in Q4. Similar measures the first two applications to support multi-billion dollar
have been taken elsewhere in the region, notably by the restructurings of prominent groups in the region. These are
Saudi Arabian Monetary Authority. The support provided likely to pave the way for an increased interest in the formal
by banks has typically comprised of deferrals rather frameworks now in place to support distressed situations.
than waivers.
As the deferrals come to an end, we expect the economic PwC Local contact: Mo Farzadi
pressure created by lower oil prices and the impact of the mo.farzadi@pwc.com
+971 56 682 0649
Insolvency appointments
Note: No data available
28 | Global Restructuring Trends | PwC Data sources are available on page 49The Netherlands
$909 4.9% 28.0%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(3.7)% (7.7)% 5.0%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
4.4%
Unemployment | 2009
6.5%
Unemployment | 2020
5.0%
Unemployment | 2021
Following sharp falls in GDP and rises in unemployment, The sectors that are likely to face increasing pressure
the Dutch economy is not expected to recover to pre-crisis include retail, travel, transportation & logistics, but also
levels until 2024 in more conservative scenarios. the construction sector. The construction sector was
already under pressure pre-COVID-19, driven by the
Nonetheless, insolvency rates have stayed remarkably so-called PFAS-crisis and nitrogen-crisis, during which
low, driven by support from the government, as well as a limited number of permits were issued by the government
the banking sector. For affected companies, the options for new building projects.
include partial payment of a company’s personnel costs
by the government, the postponement of tax payments In light of these developments, the new WHOA
and government guarantees on newly issued bank loans. restructuring law, which is expected to become
At the same time, banks have offered to suspend interest effective during the second half of 2020, is becoming
and amortisation payments. As a result, insolvencies were even more relevant. This so-called ‘Dutch scheme’
concentrated in sectors where the impact of the crisis was allows for a court-approved restructuring plan, in
most severe, such as travel and leisure. which hold-out positions are less likely to frustrate
a (consensual) restructuring. It also allows for a
As government support is expected to decrease significantly faster restructuring process.
over the coming months and tax liabilities and interest
and amortisation payments become due, a wave of
insolvencies is expected during Q4. This would be
PwC Local contact: Peter Wolterman
even more likely if there is a second wave of infections. peter.wolterman@pwc.com
+31 088 792 50 80
Insolvency appointments
29 | Global Restructuring Trends | PwC Data sources are available on page 49New Zealand
$207 21.3% 66.3%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
0.3% (7.2)% 5.9%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
5.8%
Unemployment | 2009
9.2%
Unemployment | 2020
6.8%
Unemployment | 2021
The level of formal insolvencies has remained broadly We anticipate a significant uptick in insolvency and
consistent with last year, but the rates have actually restructuring activity in Q1 2021, once the existing support
decreased since the outbreak of COVID-19. This is largely measures wind down. The main focus will be businesses
due to government initiatives that have provided in sectors such as tourism, hospitality and leisure and
businesses with additional liquidity (e.g. wage subsidies, tertiary education, along with primary industry segments
cashflow loans and tax regime changes). However, the reliant on recognised seasonal workers. As these
banking sector has also played a key role through allowing sectors look to recover, much will depend on the lifting
principal holidays, covenant waivers and the extension and of border restrictions.
re-purposing of existing loan facilities.
More broadly, we expect that many business owners
In addition, the temporary relaxation of certain directors’ will take 2020 as a ‘moment of truth’ and run a ruler across
duties is intended to give boards of viable businesses the their businesses from top to bottom. Financial, operational
confidence to trade on through the COVID-19 uncertainty. and strategic restructuring solutions (e.g. divestment of
non-core entities) will be used to create businesses that
The introduction of a new Business Debt Hibernation are more internationally competitive, environmentally
scheme provides an option for businesses to obtain a sustainable and clear on their value propositions and
seven-month standstill on existing trade debts. However, competitive advantages. This will act as a springboard
for those under greater financial pressures, this may have for long term viability and growth beyond the recovery.
to be used alongside other restructuring processes (e.g.
a creditor compromise) to be effective.
PwC Local contact: John Fisk
john.fisk@pwc.com
Insolvency appointments
+64 4 462 7486
30 | Global Restructuring Trends | PwC Data sources are available on page 49Norway
$403 4.5% 8.5%
2019 GDP (bn) Funding | August 2020 Furlough | July 2020
(1.7)% (6.3)% 2.9%
GDP YoY | 2009 GDP YoY | 2020 GDP YoY | 2021
3.3%
Unemployment | 2009
13.0%
Unemployment | 2020
7.0%
Unemployment | 2021
The economy has been hit by both COVID-19 and In comparison to other markets, Norwegian regulations
low oil prices, resulting in the lowest GDP growth in and procedures for debt negotiations have been seen
decades. Tourism, travel, entertainment, hospitality and as rigid, and rarely used. This could now change.
offshore are amongst the most heavily affected sectors.
The new legislation has similarities to Chapter 11 in
However, overall insolvency activity has remained stable the US and is expected to improve the scope for
as a result of extensive economic support packages from meaningful negotiations and solutions.
the government. Many businesses have focused on crisis
management, cash flow forecasting and securing liquidity. PwC Local contact: Per Christian Wollebæk
We expect restructuring and insolvency activity to increase per.wollebaek@pwc.com
in 2021 as government support unwinds. Moreover, a new
temporary law, expected to become permanent, may +47 952 60 318
contribute to an increased number of debt negotiations,
with the aim to avoid unnecessary bankruptcies.
Insolvency appointments
31 | Global Restructuring Trends | PwC Data sources are available on page 49You can also read
