Author(s): Oliveira, Miguel Cardoso Farinha
Date: 2016
Persistent ID: http://hdl.handle.net/10362/18621
Origin: Repositório Institucional da UNL
Subject(s): Bankruptcy Law; Processo Especial de Revitalização; Reorganization; Z-Score; Domínio/Área Científica::Ciências Sociais::Economia e Gestão
The 2012 amendment to the Portuguese Insolvency Law aspired to recover viable firms by introducing a locally adapted Chapter 11, named Processo Especial de Revitalização, though collecting wide-spread criticism in the process. This paper studies the outcome of 339 reorganizations, dated from 2012 to 2013, highlighting a severe problem of filtering: 141 firms (41.6%) have already entered bankruptcy, have petitioned for a new reorganization or are inactive. Moreover, using the accounting information available and the Altman Model, neither reorganized companies appear to be fundamentally different from bankrupted firms, nor it was possible to winnow viable from non-viable firms.
