Title: Taxonomy of six explanatory reorganisation interruption patterns: empirical evidence from the Finnish firms, June 2008-May 2009

Authors: Eija-Leena Karkinen

Addresses: Department of Accounting and Finance, University of Vaasa, P.O. Box 700, Vaasa FI-65101, Finland

Abstract: The purpose of this study is to examine the characteristics of firms (n = 60) that have interrupted their reorganisation proceedings under Finnish Company Reorganization Act (comparable to Chapter 11 in Bankruptcy Act in the USA) during the period 1 June 2008–31 May 2009. Cluster analysis is applied to estimate the differences in characteristics of interrupted firms. The results show that the firms are statistically significantly different in terms of prefiling financial ratios. There are also some statistically significant differences in non-financial characteristics among the groups. Overall, the empirical evidence is consistent with a view that the interruptions are primarily caused by inefficient reorganisation proceedings.

Keywords: reorganisation interruption patterns; restructuring; firm failure; financial ratios; financially distressed firms; turnaround; enterprise development; cluster analysis; Finnish firms; Finland; reorganisation inefficiency.

DOI: 10.1504/IJMED.2010.037067

International Journal of Management and Enterprise Development, 2010 Vol.9 No.3, pp.276 - 291

Published online: 22 Nov 2010 *

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