Corporate restructuring in Mexico involves a detailed examination of your business in order to identify inefficiencies and opportunities for improvement, leading to an organizational overhaul that is desigend to improve performance and increase profits. Corporate restructuring can involve an exploration of operations, managerial structure, and company-worker relations, as well as a forensic investigation of your tax compliance in Mexico and potential tax management opportunities.
Mexico is an attractive destination for investment, as one of the four “MINT” nations, along with Indonesia, Nigeria, and Turkey, that have previously been identified as emerging economies offering very strong growth potential and good returns to investors.
The North American county boasts the second-largest economy in Latin America by gross domestic product (GDP), which reached $1.27 trillion in 2019. Meanwhile gross national income (GNI) — a key marker of overall prosperity — reached $9,430 per capita that same year, placing Mexico as an upper-middle-income country according to World Bank standards.
Mexico is also a major player in international trade, being the 17th-largest exporter in the world and having one of the most extensive portfolios of active free trade agreements on the global stage. The country’s participation in the United States-Mexico-Canada Agreement (USMCA) provides preferential access to the rest of North America, while Mexico is also a founding member of the Pacific Alliance — a regional trade bloc that includes Chile, Colombia, and Peru, and which has ambitions to expand beyond the region.
Mexico is Latin America’s fourth-largest oil producer, delivering two million barrels per day on average, while other major exports include vehicles, electrical machinery, and medical equipment. The United States is Mexico’s main export destination, with other principal export partners including Canada, Germany, China, and Japan.
If you are doing business in Mexico and think that corporate restructuring could be of interest to your organization, read on to understand more about the process and its benefits. Or go ahead and reach out to us now to discuss your commercial options.
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What is corporate restructuring in Mexico?
Corporate restructuring in Mexico involves a deep dive into every aspect of your company’s operations and finances in order to identify and implement improvements. While it is common for companies facing serious operational or financial difficulties to undertake corporate restructuring in Mexico, this is not always the case. The process is also undertaken by companies seeking to adapt to new market conditions, recalibrate following unprecendented growth, or simply to seek out ways to reduce costs, improve profits, or otherwise increase financial and operational efficiency.
Corporate restructuring in Mexico can also help you better your overall legal and tax compliance, in addition to identifying opportunities to optimize resources or improve the application of technology in your production and processes.
Some key types of corporate restructuring include:
Organizational restructuring: Carried out when seeking to modify the internal structure of a company. Its main objective is to increase profitability and operational efficiency.
Financial restructuring: Takes place when an organization is no longer profitable or its profits have significantly reduced, due to a drop in sales, a rise in costs, a change in regulations, or a combination of such factors. Its main objective is to find cost-saving opportunities and to help the company arrange its finances to make any outstanding debts manageable.
Technological restructuring: Involves a full revision of the technology employed by the company, and identifies opportunities to adopt new technological tools intended to improve company performance and competitiveness.
Main benefits of restructuring your business
Some of the benefits of a corporate restructuring in Mexico include:
Legal compliance: A process of corporate restructuring in Mexico will identify non-compliance and potential for future non-compliance and eliminate them, maintaining your company’s good standing with local authorities and promoting its longevity by avoiding potential penalties.
Increased opportunities: A part of corporate restructuring can be to identify potential or untapped opportunities available to you based on the type of business you have and the state of the art of that industry.
Best practice: Corporate restructuring in Mexico will identify where industry standard best practice is not being employed, helping you to improve and better standardize your administrative and management practices.
Productive efficiency: During a corporate restructuring process, the working conditions of your employees and their relationship with the company will also be reviewed. Such a review promises greater emloyee satisfaction, which in turn should result in greater productivity.
Biz Latin Hub can help with corporate restructuring in Mexico
At Biz Latin Hub, our team of multilingual corporate legal services professionals is equipped to help you improve your business performance through a comprehensive process of corporate restructuring in Mexico based on your needs. With our full suite of back-office services, including commercial advisory, accounting & taxation, and due diligence, we can be your single point of contact to harness business opportunities in Mexico, as well as in any of the other 15 countries across Latin America and the Caribbean where we are present.
Contacts us now for personalized assistance or a free quote.
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The information provided here within should not be construed as formal guidance or advice. Please consult a professional for your specific situation. Information provided is for informative purposes only and may not capture all pertinent laws, standards, and best practices. The regulatory landscape is continually evolving; information mentioned may be outdated and/or could undergo changes. The interpretations presented are not official. Some sections are based on the interpretations or views of relevant authorities, but we cannot ensure that these perspectives will be supported in all professional settings.