In the new COVID-19 economic environment, opportunities to acquire distressed companies are likely to continue to increase, but with a different range of issues and solutions needed than those encountered in prior downturns. Careful evaluation of the underlying circumstances and strategies to address them, as well as utilizing the proper structure to acquire the distressed assets, will be paramount in this climate.
Akerman’s multidisciplinary Distressed and Special Assets Team leverages its comprehensive experience in all aspects of distressed assets to help clients address the challenges and opportunities of this unprecedented moment. Recognized by Financial Times as among the most forward thinking law firms in the industry, we deliver a deep understanding of the financial, business, and real estate markets and the existing and evolving business and legal issues, to devise innovative solutions addressing complex distressed situations. Our clients include regulated financial institutions, secured and unsecured creditors, bond holders, business debtors, creditors’ committees, private equity firms, venture capital firms, hedge funds, family offices and other investors.
Whether seeking to resolve distressed situations or capitalize on emerging investment opportunities, our bankruptcy, corporate, litigation, real estate, and tax lawyers provide legal counsel and industry knowledge to assist with all facets of these circumstances, including modifications and workouts; foreclosures; litigation; receiverships; bankruptcies and insolvency proceedings; acquisitions and sales of distressed properties, loans, assets and companies; and fund, JV, and other entity formation and agreements.
Provisions under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provide more distressed entities opportunities to the relief granted by the bankruptcy process. Some of these distressed businesses will successfully reorganize, while others may not. Whether only certain assets or the entire business are being divested in bankruptcy, investors will have an increased universe of opportunities to purchase assets with the free and clear protections afforded by a court order. Out-of-court divestitures and restructurings are also on the rise.
COVID-19 will likely be cause for an unprecedented volume of both commercial and consumer filings to inundate the bankruptcy courts. While it is too early to forecast how these cases may impact overall economic recovery, there is certainty that the proliferation of new cases will have a lasting impact on many industries, including automotive and transportation, energy, healthcare, hotels and hospitality, restaurants, retail, and sports and entertainment, just to name a few.
