Finding your company at the verge of bankruptcy can be severely agonizing and preparing for the unimaginable can be even more daunting. Distressed situation and cash flow pressure can force companies to rapidly steer business in different direction. Actions that might seem extreme in normal circumstances suddenly start to seem appropriate in adverse situations.
Wrong corporate strategies, poor management, continuous losses, uncompetitive products & services, aggressive competitors, declining market share, changes in customer preferences and market trends etc are some of the reasons that can force companies into struggling situation. Corporate turnaround is used as a retrenchment strategy to retreat from a wrongly made decisions that requires to be undone, revive the company from a distressed financial situation and turn it into a healthy and profitable one using techniques like retrenchment, re-positioning, replacement and renewal.
Our turnaround, restructuring and transformation road-map encompasses reevaluation of products, processes, people, suppliers, customers, operations, finances, infrastructure and organizational strategies, financial stabilization & internal control, new capital infusion, evaluate strategic options and redefining the strategy, develop plan for fundamental changes and financial restructuring and focusing on value creation. The best turnaround strategy is the one that is sustainable.
Turnaround management does not only apply to distressed companies, it in fact can help in any situation where direction, strategy or a general change of the ways of working needs to be implemented. Therefore turnaround management is closely related to change management, transformation management and post-merger-integration management. High growth situations, for example, is one typical scenario where turnaround experts also help.
Our restructuring group has extensive experience helping clients choose the capital structure that would maximize shareholder value and may involve changing the amount of leverage a firm has without changing the firm’s assets i.e.either increasing leverage by issuing debt and repurchasing outstanding shares or decreasing leverage by issuing new shares and retiring outstanding debt by paying off the bondholders.
Our restructuring strategy primarily focuses on – restructuring outstanding debt obligations, reduce operating costs, reduce all non-essential costs, improve working capital management, improve product/price and product/market mix, streamline product lines and accelerate the growth of high potential products & services.
Capital restructuring not only requires creative modification in the financial aspect of the company, it also takes legal, regulatory, tax, ethical, social, and behavioral considerations into account. Without having an experienced capital restructuring adviser on board, capital restructuring can be real painful and complex process whereas having one ensures the achievement of company’s financial goals.