This chapter will provide some examples of various triggers and features frequent in distressed M&A transactions, using the Venezuelan experience of the past decade. In the first two editions of this guide, we reflected upon the lessons from our experience advising buyers and sellers in 2014–2020 in the distressed M&A scene in Venezuela and translated those lessons into the description of the principal features of those Venezuelan distressed M&A deals. The government repealed foreign exchange regulations criminalising foreign currency exchange transactions and the sale of goods and services in foreign currency. The strict foreign currency exchange system criminalised black market foreign currency transactions, while the government drastically reduced the offer of foreign currency through official auctions and kept the official rate artificially low. Principal features of distressed M&As in Venezuela in the 2014–2020 periodOut-of-court saleOne of the most salient features of distressed M&A activity in Venezuela is that it occurs outside of insolvency proceedings for two reasons.

Source: Wall Street Journal October 31, 2023 09:26 UTC