At Valtus Alliance, we rely on a global network of restructuring experts because legal frameworks and restructuring cultures differ significantly across countries and regions.

In this cross-border conversation, Wim de Mulder (Partner, VALPEO, Brussels) sits down with Juan Manuel Gil de Escobar (Managing Partner, EPUNTO Interim Management, Madrid) to explore how restructuring works in Belgium — from silent bankruptcy procedures and liquidity crises to the growing role of private equity and CRO-led turnarounds.

Belgium’s Unique Concept: Silent Bankruptcy

Wim

What makes the restructuring framework in Belgium unique?

Juan Manuel

Belgium offers a particularly interesting mechanism known as “silent bankruptcy”.

Under Belgian law, insolvent companies can prepare a bankruptcy procedure confidentially before any public filing takes place. The objective is to avoid the reputational damage and operational disruption typically associated with public insolvency proceedings.

During this confidential phase, the company negotiates the transfer of assets or business activities under limited court supervision. If an agreement is reached, the formal bankruptcy filing follows shortly afterwards, allowing the transfer to be executed very quickly and with minimal disruption.

To initiate the process, the company must demonstrate that preparing the transaction confidentially is in the best interests of creditors and employees and will support a smoother liquidation of the estate.

The court may appoint a prospective bankruptcy trustee for an initial period of 30 days, extendable to a maximum of 60 days.

The Most Common Mistake: Waiting Too Long

Wim

What do companies typically get wrong in the early stages of a liquidity crisis?

Juan Manuel

The most common mistake is delay.

Companies often wait too long before taking action, which weakens their negotiating position and limits restructuring options significantly.

At the same time, many businesses underestimate the importance of cash discipline. Weak receivables management, poor cash forecasting, and continued spending based on outdated assumptions can quickly accelerate a crisis.

A company may still appear profitable on paper while simultaneously facing a severe liquidity problem because cash inflows and outflows no longer align.

This is especially common in fast-growing businesses with long sales cycles or heavy inventory requirements.

When External Restructuring Leadership Becomes Necessary

Wim

At what point should an external restructuring expert be brought in?

Juan Manuel

A CRO or interim CFO should be introduced as soon as clear warning signs emerge.

Typical triggers include:

• insufficient cash flow to cover operational needs or debt obligations
• covenant breaches
• significant margin or revenue decline
• stakeholder pressure from banks or creditors
• management teams lacking restructuring experience or crisis capacity

These mandates usually come from the board, lenders, shareholders, or occasionally courts and government bodies.

But timing is critical.

The faster a company acts, the more viable turnaround options remain available. It is equally important to bring in someone who can provide an independent perspective while still working constructively with the existing leadership team.

Strong restructuring leaders must combine credibility with the ability to make difficult decisions quickly.

Advice for Directors Under Pressure

Wim

What advice would you give to directors of companies in financial distress?

Juan Manuel

The first responsibility is visibility.

Directors must monitor liquidity and solvency continuously, with particular focus on cash flow forecasting and net asset positions.

As pressure increases, board meetings should become more frequent, and decision-making processes must be documented carefully. Board minutes are especially important because they demonstrate how decisions were made and which factors were considered.

Another critical point is stakeholder prioritisation.

In distress situations, the interests of creditors become increasingly important and may take precedence over shareholder interests. Directors must also pay close attention to intra-group transactions, ensuring they do not worsen the company’s financial position.

And finally, one principle matters above all:

Seek external advice early if the situation exceeds internal capabilities.

A Recent Cross-Border Turnaround Case

Wim

Can you describe a recent restructuring case?

Juan Manuel

One recent mandate involved the recapitalisation and restructuring of a Belgian portfolio company owned by a UK-based private equity firm.

The objective was to reduce the company’s debt burden and stabilise operations in both the short and medium term.

Working alongside the executive leadership team, our CRO led negotiations with banks, creditors, lessors, investors, lawyers, and tax advisors to prevent insolvency and secure the financing required for continuity.

At the same time, operational and financial control measures were introduced to reduce costs and improve visibility. The restructuring also required a clear communication strategy supported by detailed reporting, projections, and stakeholder coordination.

Within six months, the company successfully renegotiated its financial obligations and regained sufficient stability to continue operations with renewed momentum.

Building a Restructuring Talent Pool

Wim

How extensive is VALPEO’s restructuring network?

Juan Manuel

VALPEO currently works with around 75 restructuring managers.

These professionals bring experience in transformation, post-M&A integration, crisis management, and operational turnaround. Each manager is assessed not only for technical expertise, but also for leadership maturity and the ability to integrate into complex organisational environments.

In 2025 alone, VALPEO completed 14 assignments directly linked to restructuring situations.

Collaboration Between Management, Creditors, and Courts

Wim

How efficient is collaboration in Belgian restructuring proceedings?

Juan Manuel

Generally, the collaboration is balanced and relatively efficient.

Recent reforms aligned Belgian insolvency law more closely with the EU Restructuring Directive, creating a framework that supports both business continuity and creditor protection.

The system aims to provide flexibility for viable businesses while preventing abuse of restructuring procedures.

The Growing Role of Private Equity

Wim

How established is private equity in restructuring situations?

Juan Manuel

Private equity is becoming increasingly active in Belgium’s restructuring market.

Banks and existing shareholders — particularly family shareholders — still dominate the early stages of financial distress. However, specialised private equity firms are increasingly stepping into situations that require operational transformation alongside financial restructuring.

This is particularly relevant in cases where traditional financing alone is no longer sufficient to restore competitiveness.

Relationship Banks: Partners and Gatekeepers

Wim

How do relationship banks behave during restructuring?

Juan Manuel

They can act as both partners and obstacles.

When a business remains viable and communication is transparent, banks are often constructive and willing to support restructuring efforts.

However, if transparency is lacking or risks become too high, banks shift quickly into capital protection mode.

Recent legal reforms in Belgium have encouraged a more collaborative restructuring environment, but banks remain highly disciplined when assessing exposure and recovery risk.

Final Perspective

Belgium’s restructuring environment combines legal innovation with pragmatic execution.

But even with mechanisms such as silent bankruptcy, outcomes still depend on timing, transparency, and leadership.

Companies that recognise pressure early and act decisively retain far greater control over the restructuring process.