Restructuring & Insolvency end of year review—a look forward to 2016

Restructuring & Insolvency end of year review—a look forward to 2016

Our panel of experts considers what lies ahead for restructuring & insolvency lawyers in 2016.

The experts:

Nick Hood, business risk adviser, Opus Restructuring, chartered accountant and former insolvency practitioner

Andrew Wilkinson, partner, Weil, Gotshal & Manches

Jennifer Marshall, partner, Allen & Overy

Chloe Poskitt, solicitor, Browne Jacobson

A view from the market

What are your predictions for the restructuring & insolvency market for 2016?

Nick Hood: It seems likely that 2016 will be another tough year for insolvency and restructuring professionals. There is little reason to expect any significant pick up in volumes or asset values and the plethora of changes brought in this year will make earning a decent profit even more difficult. More firms will merge or close down and more insolvency practitioners will leave the market. Those who survive and thrive will be the most efficient and the most flexible, as well as those with a modest level of fixed overheads. Fixed fees quoted at the outset will become the norm, not just for formal processes, but also for consensual workouts. One potential new source of work may be the crowdfunding peer to peer market, but the lack of workout expertise among these platforms will pose real problems for IPs who look for work in this sector, who are likely to run into the sorts of problems traditionally faced in the past when dealing with private debenture holders.

Andrew Wilkinson: Going into 2016, default rates are low and the European restructuring market as a whole is looking relatively benign. We will be watching the response of the credit markets to a Fed rate rise. If markets tighten substantially, weaker issuers will struggle to refinance themselves and we could see an uptick next year in the default rate. Sector specific, the extractive industries generally and oil and gas in particular will continue to feature in the restructuring market next year. Also, we expect to see more

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