Business Recovery - The Practice
Companies find themselves under financial distress for a variety of reasons, internal and external, typically multi-faceted. The onset of a financial crisis can happen rapidly or gradually. If the causes of the financial distress are not addressed with an effective strategy to turn the company around, the end result can be insolvency. Creditors’ and shareholders’ interests add to the complexity of a difficult situation. Helping a company reorganize its operations and address the concerns of creditors while continuing its day-to-day business is the primary focus of Schulze Haynes & Co.’s Business Recovery & Solutions Group.
Schulze Haynes Loevenguth & Co.’s Business Recovery & Solutions specialists, working closely with Insolvency Counsel, specialize in responding to companies in various stages of financial distress. We have the experience and independence required to assist management in the development and execution of an effective plan of reorganization or a return to liquidity.
OBJECTIVES
- Stabilize the developing crisis
- Determine the causes of the financial crisis
- Develop a plan for restoring profitability
- Continuation of the business while implementing change and resolving issues
- Return the company to profitability and positive cash flows
- Long term stability / short term needs of creditors
- Asset preservation and recovery
- Maximize value for the company, its creditors and investors
EXPERIENCE
Our principals and senior consultants are able to call upon their history of management and financial experience in workout and turnaround situations to develop and implement an effective reorganization strategy. They have a minimum of 25 years of business experience. They have been entrepreneurs, CEO’s, COO’s, and CFO’s. Our hands-on experience enables us to identify directly with the issues faced by management in crisis situations.
Our experience covers a broad variety of industries. We have worked with small to middle market to Fortune 500 companies. In addition we have an extensive range of external resources that enable us to address all aspects of a successful reorganization.
LISTING OF SERVICES
Schulze Haynes Loevenguth & Co. specializes in managing the reorganization of a financially distressed company. The following is a comprehensive list of core issues and specific tasks that we address during the reorganization process:
 Comprehensive Assessment
- - Prepare projections of cash flows and operating results
- Operating profitability analysis / revenues, pricing, costs and expenses
- Cash flow analysis - sources and uses
- Market Analysis
- Competitive Analysis
- Identify causes of financial distress – internal and external
- Identify company and management strengths and weaknesses
- Identify changes required to return company to profitability
- Valuation of company and its key assets
- Develop a decision-making matrix to determine whether bankruptcy or workout outside the court is the preferable option.
Development of Reorganization Plan
- - Preparation of projections in support of plan
- - Establish milestones and benchmarks
- Presentation of plan to all interested parties (creditors, customers, employees, management and investors)
Establish, Restore, Maintain Communications with Creditors
- - In conjunction with Counsel
- - For the Debtor
- Company recognizes and is addressing issues
- Explanation of causes of financial distress by independent experts
- Representation in discussions and negotiations with creditors
- For the Creditors
- Creditor committee representation / negotiations
- Independent review of reorganization plans and projections
Restructure Operations
- - Interim financial and operational management
- - Cash Flows
- Cash flow modeling / projections
- Determine current cash flow demands
- Identification of cash generation / acceleration opportunities
- Managing cash flow
- Operational planning / business process
- Identify revenue increasing / cash acceleration opportunities
- Product profitability / pricing, costs and margins
- Identify additional sources of revenues
- Cost reduction and control / operating efficiency analysis
- Review of executory contracts / re-negotiation / termination
- Workforce reduction
Debt & Debt Payment Restructuring
- - Financing alternatives / assistance in arranging financing / debt or equity
- - Restructure trade and institutional debt (secured and unsecured) / minimize cash required to service debt
- Debt for equity swaps
Asset Management
- - Asset utilization / maximization of return on assets
- - Inventory utilization and management / purchasing policies and procedures
- Receivables collection / credit and collection polices and procedures
- Orderly sale of assets to improve liquidity
Additional Services Depending on Specific Circumstances
- - Forensic accounting / analysis of preference items
- - Fraud investigation / fraudulent conveyances
- Liquidation values
- Tax consultation
Many of these issue areas overlap. This requires that they be managed concurrently in order to restore financial viability. Our professionals are uniquely qualified to assist management in the reorganization effort.
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