Crisis Management

We assist companies in designing and implementing a plan of restructuring measures in the strategic, operational and financial area. We proceed systematically to help clients stabilise the situation in the short term, thereby creating prerequisites for the preparation of medium- and long-term measures aimed at restoring the company's value. Subsequently, we help our clients to define and implement such measures.

Identification and implementation of strategic measures -> Leading the company in the right direction

• Enhancing business strategy (expansion of sales channels, product lines, market coverage, etc.)
• Enhancing business functions
• Rationalising product portfolio
• Marketing analysis
• Optimisation of the corporate structure (e.g. merger/liquidation of subsidiaries), including optimisation from a tax perspective; divestment of non-operating assets in cooperation with our tax department
• Resetting of internal processes (centralising sales and purchasing functions, etc.)

Identification and implementation of operational measures -> Profitability and liquidity improvement

• Profitability analysis by product categories, services, sites, etc.
• Sustainable costs reduction
• Optimisation of operating capacity
• Liquidity and working capital improvement
• Implementation of a key performance indicators system

Designing a concept of financial restructuring as well as support during negotiations related thereto -> Capital structure stabilisation

In times of liquidity crisis, we are ready to assist management to propose, manage and implement so-called “quick wins” in releasing funds tied to working capital. We have extensive experience in optimising and managing working capital across multiple industries.

• Release of tied resources from individual components of working capital – “cash conversion cycle”
• Preparation of a comparative analysis of the company’s working capital parameters vis-à-vis a group of similar companies and identification of opportunities for improvement ("benchmarking")
• Identification of potential “quick wins” and longer-term working capital improvement opportunities
• Implementation of long-term measures to improve liquidity

Provided that the situation allows for an out-of-court solution in the form of financial restructuring, we assist companies in designing and implementing a restructuring plan.

We help the companies to design and realise restructuring of the balance sheet, to optimise the capital structure, to refinance its existing debt and to obtain new financing options (e.g. in the form of off-balance sheet financing).

Financial restructuring

• Preparation and implementation of a restructuring strategy
• Assistance in the preparation of a business plan and future outlook taking into account the proposed restructuring options
• Proposal of adjustments of hedging instruments that correspond to the selected restructuring strategy

Stakeholder management

• Stakeholder analysis, determination of negotiation tactics
• Providing comprehensive management of tenders, communication with applicants for funding
• Coordination of key stakeholders
• Monitoring of management and cash flow development

Loan refinancing

• Capital structure assessment
• Covenant testing, security review
• Change from bilateral to structured financing
• Negotiation of better financing terms
• Standstill negotiation

Assistance with fund raising

• Support in securing financing, project management and communication with potential creditors
• Selection of a financing provider through tenders
• Assistance in identifying an optimal debt capacity
• Assistance in modifying the capital structure
• Support in setting the covenants

Negotiating a particular restructuring solution is often challenging, due to an informational asymmetry among individual stakeholders. Their assessment of a proposed out-of-court solution may be influenced by the inaccurate perception of their hedging instruments, which could be substantially different if put to the test of formal in-court (insolvency) proceedings.  An EFO thus serves as a benchmark to compare the terms of a proposed out-of-court restructuring solution with alternative hypothetical in-court scenarios.  The EFO process involves performing an indicative valuation of both the business and its assets, as well as determining the potential claims among which this value would be distributed.

EFO serves as a tool for determining the impact of insolvency on (i) the value of the business if sold as a going-concern or on a piecemeal basis; (ii) the dilution of the creditors’ balance sheet claims, creditor with priority claims, and other off-balance sheet items that would only crystallise in insolvency proceedings; and (iii) the ranking of entitlement to claim satisfaction under applicable jurisdictions.

• Definition of hypothetical scenarios available
• Preparation of an indicative valuation using cash flow models and based on asset valuation, including the preparation of the relevant scenarios concerning the value of the business
• Estimation of potential claims that would crystallise under each scenario,
• taking into account jurisdiction-specific issues related to claim types and priorities
• Estimation of recovery for secured and unsecured creditors under each scenario

Taking into account all possible options available for a financial distress solution, a controlled insolvency process can be identified as the most appropriate under certain circumstances.  At other times, insolvency may be an unplanned and unexpected event.  In both cases the priority is to protect the value of the company and to maximise satisfaction, which requires extensive expertise and experience with insolvency proceedings.

Pre-insolvency process

• Pre-packaged reorganisation and moratorium
• Countering hostile insolvency filings
• Estimated Financial Outcome

 Insolvency procedure

• Liquidity management
• Support in securing credit and off-balance sheet financing
• Preparation of a restructuring strategy
• Preparation and administration of property inventory as well as valuation of assets
• Preparation of a reorganisation plan
• Support in selling assets
• Preparation and implementation of the sale process of a distressed company
• Review of potentially contestable legal acts
• Preparation of materials for the creditors’ committee or the creditors' meeting
• Coordination of stakeholders (management, shareholders, creditors, insolvency trustee, other advisers)
• Interim management

Post-insolvency process

• Support of post-deal handover
• Support during distribution of proceeds according to schedules
• Support with post-deal integration

If you become aware that your subsidiary business or autonomous business unit facility is underperforming, we are able to help you to recover its optimal value.  We will cooperate with you to identify the issues and to evaluate the options available and we will assist in implementing the selected approach. We can also help you to identify and manage the risks inherent in the process. The planned outcome will be an increase in shareholder value by selling, restructuring, closing, or winding down the underperforming business or subsidiary.

We aim to avoid the “fire-sale” scenario. The exit route we prefer is the “fix and sell” scenario where we combine our turnaround and disposal expertise to maximise the value of the transaction.  We may even consider expanding the business by merger or acquisition if this can add to the eventual resale value.

Controlled exit – we would gradually shut down operations over an agreed time frame, while finishing existing orders, selling assets and maximising the collection of receivables.  Sometimes, however, the best strategy may be to terminate the company’s activities as soon as possible.

• Capital release to reinvest in the business
• Help to re-deploy resources more productively elsewhere in the business
• Maintaining brand reputation and avoiding adverse publicity
• Application of our proven methodology to avoid delays and obstacles typical of divestment or disposal, thus reducing the costs and maximising recovery

To support owners facing an urgent need for cash or insolvency trustees charged with selling a debtor’s estate with the distressed sale of the entire business or selected assets by providing management of the sale process.

• Assessment of distressed sale options
• Assistance in preparation of a data room
• Valuation of the business or assets
• Identification and addressing potential investors
• Preparation of teasers and information memoranda
• Preparation of transactional documentation
• Assistance with due-diligence and provision of information to potential investors
• Coordination of stakeholders during the sale process
• Support of post-deal handover
• Support with post-deal integration

Distressed M&A has its particularities; the transactions must be structured accurately while being aware of what you want to buy and what the risks are, if any. All that needs to be performed very quickly. Our services in this area:

• Assistance with transaction structuring
• Assessment of whether it is best to buy the company or its part or assets
• Risk identification and limitation options
• Assistance in negotiation with the seller
• Conducting of due diligence
• Support of post-deal handover
• Support of preparation and implementation of the restructuring plan

We advise banks and other financial institutions on the disposal of non-performing loans. Our services include conducting portfolio assessment, conducting of financial due diligence, preparation of information memoranda, asset valuations and disposal options. We identify potential investors, and facilitate sales negotiations and deal completion.  

NPL portfolio assessment

• Portfolio evaluation, stratification and segmentation
• Portfolio due-diligence and validation of assumptions
• Development of an optimal portfolio sale strategy

 Market assessment

• Assessment of the interest of strategic and financial investors (market testing)
• Recommendation of further steps in the NPL portfolio value optimisation

 Debt sale

• Implementation of the portfolio sale strategy
• Preparation of teasers and information memoranda
• Preparation of transactional documentation
• Management of relationships with investors and support in negotiations
• Investor selection and transaction closure

 Purchase of receivables

• Purchase strategy of the portfolio
• Portfolio due-diligence for potential investors
• Support with transaction negotiations

Prevention of bad debts

• Analysis and improvement of the collection process
• Implementation of a key performance indicators system
• Design and implementation of collection strategies