Wednesday, February 17, 2021
COVID-19 continues to disrupt normal business operations, creating liquidity problems and negative working capital for many companies. As fund sponsors take actions to help their portfolio companies navigate through this time, they should alsosensitize directors to insolvency issuesand the associated litigation risks. As we have previously highlighted, bothfunds and fund managers may face increased risks of litigation exposurewhen a portfolio company is running low on cash and faces the possibility of restructuring or reorganizing. The COVID-19 pandemic and the havoc it has wrought in its wake has amplified these risks, as companies scramble to shore up their cash positions. These litigation risks are also m…
Read the full article at: https://www.natlawreview.com/article/portfolio-company-insolvency-risk-mitigation-strategies-fund-sponsors-and-board