reorganization

play
noun re·or·ga·ni·za·tion \ (ˌ)rē-ˌȯr-gə-nə-ˈzā-shən , -ˌȯrg-nə- \
Updated on: 26 Jul 2017

Definition of reorganization

:the act or process of reorganizing :the state of being reorganized; especially :the financial reconstruction of a business concern

reorganizational

play \-shnəl, -shə-nᵊl\ adjective

Recent Examples of reorganization from the Web

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'reorganization.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

First Known Use of reorganization

1751


Financial Definition of REORGANIZATION

reorganization

What It Is

Reorganization may refer to the rehabilitation of a company's finances pursuant to a bankruptcy. It can also refer to any process that affects the tax structure of a corporation. In addition, reorganization may refer to a merger or acquisition or sale of a company that changes the ownership, stock, or legal and management structure.

How It Works

Reorganization is a formal court-supervised process of restructuring a company's finances after a bankruptcy. In accordance with bankruptcy laws, specifically Chapter 11, a company is given protection from creditors during the time period when the company proposes and a bankruptcy court reviews and approves a specific reorganization plan. The reorganization is intended to repay creditors to the maximum extent possible and to restructure the company's finances, management, and operations to prevent the same problem from arising again.

A company may reorganize itself, including its legal or corporate structure to take advantage of existing or new tax regulations.

A merger or acquisition of a company may result in a reorganization of the company ownership, equity structure, management, and operations to take advantage of the efficiencies of new management, new technologies, and new capital assets.

Why It Matters

Reorganization is an important step for a business since it has the potential to open up new opportunities, increase efficiencies and profits, and give legal and financial protection during difficult times.


Law Dictionary

reorganization

play
noun re·or·ga·ni·za·tion \ ˌrē-ˌȯr-gə-nə-ˈzā-shən \

legal Definition of reorganization

1 :the act of reorganizing :the state of being reorganized
2 a :the rehabilitation of the finances of a business in accordance with a plan approved by a bankruptcy court under the provisions of chapter 11 of the Bankruptcy Code
b :any of various procedures (as recapitalization or merger) that affect the tax structure of a corporation under the Internal Revenue Code and often produce favorable tax treatment
A reorganization \ˈā-\
:a reorganization that consists of a merger or consolidation which complies with the requirements of applicable state statute
B reorganization \ˈbē-\
:a reorganization involving the acquisition by one corporation of the stock of another corporation in exchange solely for all or some of the voting stock of the acquiring corporation or its parent either of which has control of the acquired corporation immediately after the acquisition
C reorganization \ˈsē-\
:a reorganization involving the acquisition by one corporation of substantially all of the property of another corporation in exchange solely for all or part of the voting stock of the acquiring corporation or its parent regardless of any liability assumed by the acquiring corporation as a result of the acquisition
D reorganization \ˈdē-\
:a reorganization involving a transfer by a corporation of all or part of its assets to another corporation that results in control of the other corporation being immediately placed in the transferor or one or more of its shareholders or both but under which the stock or securities of the other corporation must be distributed in a qualified transaction — see also spin-off, split-off, split-up
E reorganization \ˈē-\
:a reorganization that consists of a recapitalization
F reorganization \ˈef-\
:a reorganization consisting merely of a change in the identity, form, or place of organization of a corporation
G reorganization \ˈjē-\
:a reorganization involving a transfer by a corporation of all or part of its assets to another corporation under a bankruptcy or similar proceeding provided that the stock or securities of the other corporation are distributed in a qualified transaction
3 :alteration of the existing structure of governmental units (as bureaus or legislative committees) and the lines of control and authority between them usually to promote greater efficiency and responsibility


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