What is corporate restructuring with example? Restructuring occurs when a company makes significant changes to its financial or operational structure, usually while under financial duress.
Typical strategies include debt consolidation, spin-offs of operating divisions, plant closings, and layoffs. Example Having experienced declining market share and profits Mizer Pharmaceuticals lays off 30% of its staff, closes research facilities, relocates manufacturing facilities to Somalia, and doubles the salary of the CEO.
Losses are in the $100s of millions. Instead of showing the losses as ordinary, they are classified as a Restructuring Charge. A more accurate label for these “Restructuring Charges” might be something like “Losses due to Mismanagement”.
