The 2008 forecasts were on the money: Italian lawyers increasingly have been engaged in restructuring transactions in the last few years more than ever before. For 2012, the “driving sector” for Italian Law Firms will be financial restructuring.
With the upheaval of the financial-industrial Italian crisis during 2011 we experienced some very complicated Italian debt restructuring transactions (Seat Pagine Gialle; Ferretti Group; Lucchini; D’Amato di Navigazione; Antichi Pellettieri; Fondazione San Raffaele; Irplast and Koelliker-Group). Recently the restructuring sector has been mainly characterised by a re-definition of companies’ financial profile due to the enormous burden of accumulated debt. However, due to the collapse of confidence in the Italian economy, in September 2011 there were some significant failures of companies’ industrial/business plans. These plans were contained in a number of Italian Court-approved restructuring agreements signed between creditors pursuant to Art. 182 bis of the Bankruptcy Law (“Accordi di ristrutturazione”), which needed to be substantially amended. These changes were not a consequence of the content or integrity of these industrial/business plans in and of itself, but of the inability to predict the Italian economy’s trend either by companies’ managers or by banks. In any case, the approach of banks and companies has recently changed: banks are striving to support distressed companies, and entrepreneurs seek to be an “active part” of their companies’ recapitalization. Entrepreneurs/managers have started to realise that a company’ crisis can be just a phase in the existence of a company and not necessarily reason for “shame” and “humiliation”, especially if these companies maintain a vivid business and a profitable market sector. The need for astute restructuring lawyers and tax experts (the new “players” of that scenario) is increased as much as their skills: they must have an ability to work in a global/international context – as these restructurings processes often involve international groups with Italian subsidiaries or international investors -, and they must be able to find durable and innovative solutions, particularly to overcome the difficulties of financing for various businesses. If in 2009/2010 it was relatively easy to find new companies able to replace the distressed companies, in contrast in 2011 it was more difficult especially in the environment of an uncertain situation in the Italian market. This is why in 2011 it was more difficult to find investors able to invest money and continue the companies’ activities having signed Italian pre-insolvency agreements (for example “concordati preventivi“). As this sector is growing more complex, participants require clear guides as to how to proceed. Therefore, it is essential that an intervention of the legislature occur, which addresses various reforms to tax and bankruptcy-related aspects of Italian law.