Our Business Restructuring team provides pragmatic and robust Restructuring and Insolvency advice to lenders, creditors, companies and individuals.
We have strong working relationships with all our clients that go beyond the individual assignments we work on. In conjunction with our colleagues across the firm we endeavour to produce regular communications and publications that will assist our contacts in making the right decisions for their business.
The aim of restructuring is to avoid a formal insolvency. Now more than ever you should be reviewing your companies position. We offer an array of solutions to help businesses that are underperforming, in crisis or who simply want to ensure they are in a good position for the future. All advice given is highly confidential.
So you can understand how we review businesses and develop tailored restructuring solutions the following underlying elements taken in to consideration.
Stage 1: Stabilisation
BDO’s Financial Review services are an essential component of our Restructuring Advisory practice; informed decisions require robust information. Without effective, objective analysis and understanding of a business’s current position, trading history and projections, a credible restructuring plan cannot be formulated.
Review Of Short Term Cash Flow: normally a review of a 13-week daily cash flow forecast.
Working Capital Management: Does the business have sufficient working capital facilities to trade on while restructuring options are explored?
Stage 2: Diagnosis and Formulate Options
Although each business is unique, we set out below some common areas where financial review is undertaken:
- Review of current financial position
- Review of historical trading
- Review of projected trading
- Identification of the key business drivers
- How resilient is the business to factors outside of management’s control?
The key to delivering successful operational restructuring programmes is execution performance of the various profit improvement initiatives to be implemented. We recognise the difficulties in delivering complex operational restructuring projects and have developed our operational review methodology to assist our clients understand and resolve implementation issues:
Restructuring processes are becoming more sophisticated and stakeholders take steps to manage investments before they become financially distressed.
Understanding a business in its competitive environment is vital to understanding what businesses it should or should not be in and, more importantly in a restructuring context, where scarce capital resources should be focussed.
Our Strategic Consulting team can provide valuable advice in this area. Common areas we are asked to look at are set out below.
- What key markets does the group operate in?
- Where do the group’s products fit into them?
- What are the competitive pressures on the group and its products?
- Where should the group focus its resources in the short, medium and longer terms?
The aim of restructuring a business is to avoid a formal insolvency process. However, it is often prudent to plan for how such an insolvency process might be implemented, should the restructuring not be possible. Being prepared for all eventualities makes good management sense and should mean fewer surprises for stakeholders. There is sense in the maxim “hope for the best, plan for the worst”.
Stage 3: Provide Advice Implement & Monitor
Financial Restructuring, Re-financing, Debt advisory
Improving the make-up of the balance sheet is usually a key element of any restructuring plan. This is in addition to fundamental changes to the business’s operations, for example from sale of a division or performance improvement, which is often necessary to deal with the effects of past losses to put the business back on a sound footing. We are experienced in the various skills required for this—examples of which are set out below.
The key to delivering successful business strategies and driving value is execution. We recognise the difficulties in executing complex restructuring projects and have developed our operational Performance Improvement offering to assist our clients.
Our Performance Improvement specialists have extensive industry experience in leading and executing operational turnaround and restructuring projects.