Abstract

This paper looks at the finaicial distress and subsequent finaicial restructuring at Metallgesellschaft AG. We examine the role of the German corporate governance mechanism and the German bankruptcy code in facilitating the recovery. We find that while German corporate governance and bankruptcy laws catalyzed the recovery,they could not help in averting financial distress. Specifically, the role of financial institutions in corporate governance and the legal framework for troubled companies in Germany had a siggnificant role to play in ensuring the survival of Metallgesellschaft AG.