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A Path to Recovery and Growth

Debtor-in-Possession (DIP) Financing

When businesses face financial distress, access to capital often becomes limited at the exact moment it’s needed most. Credit lines tighten, advances stop, and liquidity disappears.

Debtor-in-possession (DIP) financing is designed to provide working capital to businesses preparing to file or already operating under—Chapter 11 bankruptcy protection. Rather than signaling the end, Chapter 11 can create the opportunity to stabilize operations, restructure effectively, and reposition the company for long-term success.

How DIP Financing Supports Recovery

DIP financing can help your business:

  • Maintain operations during restructuring
  • Meet payroll and critical vendor obligations
  • Preserve customer relationships and contracts
  • Bridge cash flow gaps created by stalled financing
  • Execute a structured turnaround plan
  • Position the company for post-bankruptcy growth

With the right capital and strategy in place, Chapter 11 can become a structured reset rather than a shutdown.

Who is a Strong Candidate?

Businesses that benefit most from DIP financing typically have:

  • A clear and realistic restructuring plan
  • Identifiable revenue streams or valuable assets
  • A path to restored profitability
  • Leadership committed to disciplined financial oversight

DIP financing is built to support recovery — not liquidation.

Explore Recovery Options

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Why Choose SouthStar for DIP Financing?

SouthStar Capital has extensive experience in DIP financing, providing businesses with the funding they need to navigate through the bankruptcy process. Ideally, we encourage clients to come to us before filing for bankruptcy, allowing us to craft the best possible strategy and prepare for the Chapter 11 filing. This also enables us to file immediately after your bankruptcy filing, ensuring the process moves forward without unnecessary delays.

That said, if you have already filed for Chapter 11 bankruptcy, SouthStar may still be able to help. Our deep expertise in DIP financing ensures we can provide solutions even after the filing.

Recent DIP Case Studies

Discover how court-approved DIP financing helped these companies protect operations and emerge from Chapter 11 positioned for growth.