A Warsaw-based private equity fund identifies a distressed manufacturing company in the Silesia region. The target holds valuable machinery, a skilled workforce, and long-term customer contracts – but it is formally insolvent. The window to acquire these assets at a fraction of their replacement cost is narrow. Miss it, and a competitor or a liquidating trustee will act first.

Acquiring assets from a Polish insolvency is governed by the Prawo restrukturyzacyjne (Restructuring Law) and the Prawo upadłościowe (Insolvency Law), both administered through the district courts and supervised by court-appointed administrators. A buyer can enter through a pre-pack sale, a trustee-run tender, or a restructuring plan purchase – each carrying distinct timelines, price floors, and risk profiles. Getting the procedure wrong forfeits the asset and, in some cases, exposes the buyer to clawback claims.

This guide walks through the four main acquisition routes, the step-by-step process for each, common pitfalls, and three business scenarios drawn from manufacturing, IT, and foreign-investor contexts. Deadlines matter here. Some opportunities close within 30 days of a court ruling.

What acquisition routes are available in Polish insolvency proceedings?

Polish insolvency law offers four distinct entry points for a distressed buyer. The right choice depends on the stage of proceedings, the asset composition, and how quickly the buyer needs certainty. Each route carries a different risk-adjusted cost and timeline.

The pre-pack sale (przygotowana likwidacja) is the fastest mechanism. The buyer negotiates directly with the debtor before the insolvency petition is filed. The court then approves the sale as part of the opening order – typically within two to three months of filing. Asset title transfers free of most encumbrances. This is the preferred route when speed and clean title are the priorities.

The trustee tender is the standard liquidation route. After the court appoints a syndyk (insolvency trustee), the trustee advertises assets through the National Court Register (KRS) portal and the official insolvency notices system. Bids are submitted in writing. The process from appointment to sale typically runs four to eight months, depending on asset complexity.

The restructuring plan purchase applies in arrangement proceedings (postępowanie układowe) or sanation proceedings (postępowanie sanacyjne). Here, a buyer acquires the business or key assets as part of an approved restructuring plan. This route preserves going-concern value but requires creditor approval – a vote threshold of two-thirds by value and a majority by number.

Finally, debt-for-equity conversion allows a buyer to acquire the distressed company itself by purchasing its liabilities at a discount and converting them to equity. This is less common but relevant when the target holds a licence or permit that cannot be transferred by asset sale. The Polish Financial Supervision Authority (KNF) must be notified if the target holds a regulated licence.

How does the pre-pack procedure work step by step?

The pre-pack is the most investor-friendly route in Polish insolvency practice. It combines deal certainty with court-supervised clean title. The procedure has five defined stages, and the entire timeline from filing to closing can be as short as three months.

Step 1 – Valuation and offer. The buyer commissions an independent valuation of the target assets. The offer price must meet or exceed the valuation figure. Courts will reject pre-pack applications where the price appears to undervalue assets. Budget approximately PLN 15,000 to PLN 50,000 for a credible valuation report, depending on asset scope.

Step 2 – Pre-pack application. The debtor (or a creditor with sufficient standing) files the insolvency petition together with the pre-pack application. The application identifies the buyer, the assets, the price, and the payment terms. The National Court Register (KRS) records the filing date, which anchors the clawback look-back period.

Step 3 – Court review. The district court examines whether the sale price is fair and whether the pre-pack serves creditors' interests better than open liquidation. The court may appoint a tymczasowy nadzorca sądowy (interim court supervisor) to verify the valuation. This stage typically takes four to six weeks.

Step 4 – Approval and opening order. If approved, the court issues the insolvency opening order simultaneously with the sale approval. The buyer pays the agreed price into a court-supervised escrow account within the deadline set in the order – usually 30 days from the order date. Missing this deadline voids the sale.

Step 5 – Title transfer and employment. Once payment clears, the trustee executes the asset transfer agreement. Employees assigned to the transferred assets transfer automatically under the Kodeks pracy (Labour Code), following the rules on transfer of undertakings. The buyer should review employment obligations early – we address this in the employment compliance link below.

We secured a pre-pack acquisition of manufacturing equipment and contracts worth over PLN 8m for an industrial client in the Silesia region (autumn 2025). The court-to-closing timeline was 11 weeks.

What are the most common mistakes buyers make in distressed acquisitions?

Distressed M&A in Poland rewards preparation and punishes assumptions. The most expensive errors are procedural, not commercial. Three failure modes appear repeatedly in practice.

Underestimating clawback risk. Polish insolvency law gives the trustee power to challenge transactions concluded within defined look-back periods before the insolvency opening. Asset transfers at below-market prices within 12 months are presumptively challengeable. Transfers with intent to harm creditors can be challenged within five years. A buyer who does not verify the chain of title before the target's insolvency date may find the acquisition reversed – personal liability of the seller's directors does not protect the buyer.

Ignoring environmental and regulatory liabilities. Asset purchases in insolvency do not automatically extinguish environmental clean-up obligations attached to land or equipment. The Polish Environmental Protection Inspectorate can pursue the new owner for remediation costs. Due diligence must include environmental searches, not just corporate registry checks.

Misjudging the employment transfer rules. When a buyer acquires a functional economic unit, employees transfer by operation of law. The buyer cannot cherry-pick staff without triggering unfair dismissal exposure. For foreign investors, this is often the most surprising element of a Polish distressed deal. See our guide on employment law compliance for companies in Poland for the detailed framework.

  • Verify the insolvency filing date before signing any letter of intent
  • Commission an independent asset valuation at market, not distressed, value
  • Run environmental and planning searches on all real property
  • Map all employees attached to the target economic unit
  • Confirm whether any assets require KNF or sector-regulator consent to transfer

For a tailored strategy on distressed asset acquisition, reach out to info@kordeckipartners.com.

Three business scenarios: manufacturing, IT, and foreign investor

The same insolvency framework applies differently depending on the buyer's profile, the asset type, and the cross-border dimension. Three scenarios illustrate where the procedure diverges.

Scenario 1 – Manufacturing acquirer. A Polish industrial group targets a competitor's production line after the competitor files for insolvency. The assets include CNC machinery, a warehouse lease, and 40 employees. The buyer uses the trustee tender route. The trustee sets a reserve price equal to the court-approved valuation. The buyer submits a sealed bid within the 14-day submission window. If the bid wins, the sale agreement is executed within 30 days. The warehouse lease requires landlord consent to assignment – a detail that frequently delays closing.

Scenario 2 – IT sector acquirer. A software company wants to acquire a distressed competitor's codebase, domain portfolio, and three key developer contracts. Intellectual property transfers in insolvency follow standard asset-sale rules, but software licences granted to the insolvent company do not automatically transfer to the buyer. Each third-party licence must be novated separately. The buyer should map all inbound licences during due diligence and budget for novation fees. Timeline: six to ten weeks from trustee appointment.

Scenario 3 – Foreign investor. A German strategic buyer acquires a Polish subsidiary's assets through a pre-pack. The cross-border dimension triggers the EU Insolvency Regulation (recast), which determines which country's courts have jurisdiction. Where the debtor's centre of main interests (COMI) is in Poland, Polish courts govern the proceedings. The German buyer must verify COMI before filing the pre-pack application – a COMI located in Germany would shift jurisdiction entirely. For parallel insolvencies across EU member states, see our analysis of cross-border insolvency involving Poland and Sweden and cross-border insolvency involving Poland and Spain.

We obtained a successful pre-pack approval for a foreign investor acquiring a logistics operation in the Mazowieckie region (winter 2025), with title transfer completed within 60 days of the court opening order.

The decision matrix in brief: pre-pack suits speed-sensitive deals with a cooperative debtor; trustee tender suits competitive situations or uncooperative management; restructuring plan purchase suits going-concern acquisitions requiring creditor buy-in; debt-for-equity conversion suits regulated-entity targets where asset transfer is restricted.

Frequently asked questions

Q: How long does a typical distressed asset acquisition take in Poland?

A: A pre-pack sale can close in as little as 10 to 14 weeks from filing to title transfer. A trustee tender typically takes four to eight months. A restructuring plan purchase, which requires creditor approval, usually runs six to twelve months from the opening of proceedings. These timelines assume no court appeals – an objecting creditor can extend any route by two to four months.

Q: Does buying assets in insolvency protect the buyer from the seller's debts?

A: An asset sale in insolvency generally does not transfer the insolvent company's liabilities to the buyer. This is one of the key advantages over a share purchase. However, certain obligations follow the asset by operation of law – employment liabilities for transferred employees, environmental remediation duties attached to land, and some tax liabilities linked to the business. Due diligence must specifically address these categories. The assumption that "clean title" means "no liabilities" is the most common misconception in this market.

Q: What are the costs of a distressed acquisition beyond the purchase price?

A: Buyers should budget for an independent valuation (PLN 15,000 to PLN 50,000), legal due diligence (variable, typically PLN 30,000 to PLN 100,000 depending on asset scope), court fees on the pre-pack application, trustee's commission (set by statute as a percentage of the sale price), and any regulatory consent fees. Environmental surveys add cost where real property is involved. Total transaction costs excluding purchase price commonly run between 3% and 7% of the asset value for mid-market deals.

KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to restructuring, insolvency, and distressed M&A. We work with Polish entrepreneurs, foreign investors, and in-house legal teams navigating asset acquisitions from insolvent estates. To discuss your situation, contact info@kordeckipartners.com.

Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. KORDECKI & Partners assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@kordeckipartners.com.