substantive consolidation

Definition of "substantive consolidation"
  1. An act of merging the assets and liabilities of two or more related debtors to repay creditors, a measure often cautiously administered due to potential harm to certain creditors
How to use "substantive consolidation" in a sentence
  1. Due to their closely intertwined finances, substantive consolidation was considered for the two companies.
  2. The judge was hesitant to approve the substantive consolidation because it could negatively impact some creditors.
  3. Substantive consolidation could provide a way to fairly distribute the assets of the bankrupt firm among its creditors.

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