As soon as a company is declared bankrupt, the telephone can start ringing at the lawyers of HVG Law in the Amsterdam Zuidas, say De Wit and fellow lawyer Mayk Koria. The office, with a total of around 150 lawyers and notaries, works with a team of 11 people on bankruptcies and restructurings at companies in financial distress.
When it comes to big things, ‘everything goes aside’
The request to process a bankruptcy comes through the court. As a rule, the more experience a curator has, the more important the case. There are dozens of these per year for HVG. And with larger ones, like VanMoof, everything goes sideways, the lawyers say. “Then the home front is called and the agenda is cleared.”
After quiet corona years, the number of bankruptcies increased again this year, although a real wave failed to materialize. “We also expect an increase for next year,” say De Wit and Koria. Companies suffer from high costs and find it more difficult to obtain money. Thanks to the Homologation Private Agreement Act (WHOA), they often make an ultimate attempt to prevent bankruptcy.
It means work for De Wit and his team, who previously handled the bankruptcies of The Entertainment Group, Travelbird and Dixons, among others. De Wit is also involved in Exem Energy, a company in which Isabel dos Santos, accused of corruption, was involved. “I can’t say much about that,” he immediately adds. Bankruptcies are sensitive, they also take time: “We will certainly be busy with VanMoof for another year.”
The Dutch e-bike manufacturer went bankrupt last summer, under pressure from heavy losses. It generated a lot of media attention and left customers unsure about their orders and repairs. A new owner was found by HVG Law, but only a few dozen of the almost seven hundred employees were able to keep their jobs under the British Lavoie. The CNV trade union therefore called it a ‘drama restart’ this summer.
“I wouldn’t call it a restart,” De Wit says about the deal. But the maximum achievable: “When the company went bankrupt, there were already supply problems and production was at a standstill.” Anyone who steps in as a curator mainly puts things in order and practices crisis management, the lawyers say.
They enter a company with one goal: to make as much money as possible for a company’s creditors, from bank to manufacturer. The list of names is often long and the damage runs into millions. To get any return from this, the assets must be sold as quickly as possible. Sometimes this is successful in its entirety, in the form of a restart under a new owner.
‘Restarting becomes less easy’
More and more often it only happens in parts, for example at bargain chain Big Bazar the stocks were sold at a discount and a small part of the BCC stores went to the competitor. “The trend is that a restart is becoming less easy,” says De Wit. Problems are often already circulating in the media before a bankruptcy is declared. “Then the headhunters get to work.”
Key employees, such as IT staff, have sometimes left quickly, also due to the tight labor market. And they are crucial for the value of a company. It also means that a curator likes to hasten a deal. This is necessary anyway, because a company’s staff is still employed for six weeks, thanks to the UWV, which continues to pay salaries.
‘Hard work’
At VanMoof, the sale took seven weeks. That was ‘hard work’: calling suppliers in Asia in the morning, the US in the evening. In between ‘managing everything on the work floor.’ Inform staff about their employment and inform suppliers of their rights. VanMoof had to continue operating at minimal power: some (it) processes deliberately remained in the air, while elsewhere the plug was pulled.
It means scrapping, because (almost) everything costs money, while you want to earn it. What the curator does is strictly laid down in law, the two emphasize. Customers still waiting for an ordered bicycle? Or a supplier who still receives money for a service provided? It’s not fun, but creditors like these must properly submit their claim to the curator. Then it’s a matter of waiting.
“That leads to disappointments, but as a curator you are not there to fool people,” says De Wit.
Depending on the status of the estate, what remains at the bottom line, something can be paid out. If there is any money left over, the curator’s salary is paid first. Parties such as the Tax Authorities or banks with security rights often also have priority. For the rest, especially in the case of VanMoof, there is little hope: “The prospects are not good,” says De Wit.
‘Staff gave a final sprint’
Is making money as a curator a gamble? Sometimes there are large amounts of money to be earned, sometimes it is nothing. “It is usually a healthy mix,” said De Wit about his annual accounts.
In any case, VanMoof was the case that stood out the most this year, the lawyers say. If only because as a curator you gain deep insight into the company and the processes behind it and you have to understand how exactly such a bicycle works. The collaboration with the staff also stood out: despite everything, it still gave us a final sprint, says De Wit.
This way it was at least possible to return the broken bicycles that were still in the workshop for repair to the rightful owners.
2023-12-26 09:45:53
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