Debt restructuring is a proactive process where a viable business renegotiates its debt terms to avoid financial collapse — the company remains in control throughout. Insolvency, on the other hand, occurs when a company can no longer pay its debts as they fall due, triggering formal legal processes such as liquidation, receivership, or examinership. Restructuring aims to prevent insolvency; insolvency procedures manage the consequences of it. The earlier a business engages with advisors, the more likely restructuring becomes a viable option rather than being forced into a formal insolvency process.
