In many cases, by the time business rescue is considered, the business can no longer be rescued. In this edition of Business Law Focus, host Evan Pickworth interviews Dr Eric Levenstein, director and head of insolvency & business rescue at Werksmans, about the misuse of the process and practical steps to ensure it is used more appropriately as a mechanism for intervention rather than reaction.
Central to the entire rescue framework is the requirement of a “reasonable prospect of rescue”. This is a substantive threshold. It requires a credible, supportable basis for the company’s rehabilitation, whether through operational restructuring, the introduction of new capital, or a compromise with creditors. It is not satisfied by mere…