UK: Restructuring And Recovery

Last Updated: 17 August 2011
Article by Liam Dowdall, Seán McNamara and Paul Wyse

A solution to the problem

Smith & Williamson Freaney's restructuring & recovery team has a market-leading reputation built on innovation and reliable performance. Our directors are actively involved in all client work, with support from associate directors and managers. By appropriately matching qualified staff to client assignments, we aim to ensure that our solutions are cost effective.

Our director-led teams provide turnaround, recovery and insolvency services.

We have a broad range of experience which allows us to easily adapt to deal with both larger and smaller assignments.

We act for a variety of stakeholders and have built a strong reputation for providing innovative solutions, combined with a direct approach.

Turnaround management

If your business is underperforming we can help to improve performance or implement a financial restructuring. We can also work alongside existing management in the reduction of overheads, sale of assets and system reviews. In addition, we can assist stakeholders with a managed exit.

As part of our turnaround service we offer interim management, business restructuring, performance enhancement, overhead review, balance sheet review and cashflow review services.

Operational restructuring

To create a stable environment in which a financial and operational solution can be sought, we provide:

  • advice on the strategic options available to ensure the survival of the business
  • assistance in the preparation and implementation of a comprehensive business plan
  • evaluation of financial models with specific industry expertise
  • an indication of the anticipated return to stakeholders
  • assistance in the sale of distressed businesses.

Cashflow management

It is essential in any business turnaround to manage short-term funding requirements. We approach this in the management and collection of debts, suitable phasing of supplier payments, sale of non-core assets (including stock) to generate cash, comprehensive cashflow forecasts and stakeholder communication.

Business and liquidity reviews

These are most often undertaken when a business is either insolvent, or close to insolvency, to provide advice to a particular lender on its options. Our review will include an assessment of management's forecasts and its proposals for resolving the current problems.

Viability reviews

We can conduct a viability review; an early independent review of a business in difficulty can significantly enhance survival prospects. If this is not possible, a strategy can be developed to maximise realisation for the benefit of all creditors.

Monitoring reports

Under-performing businesses should be closely monitored to ensure an agreed recovery strategy is being adhered to and the financial position, and lender's collateral, does not deteriorate.

Liquidations

We offer the necessary advice and support to help shareholders through the liquidation process, whether it is:

  • a members' voluntary liquidation of a solvent company
  • the liquidation of an insolvent company by means of a creditors' voluntary liquidation
  • a court liquidation.

Our team will guide our clients through the liquidation process in the most efficient manner possible. We work closely with our Smith & Williamson colleagues in the UK restructuring & recovery team.

Members' voluntary liquidations

Members' voluntary liquidations are the vehicle used for the liquidation of solvent companies.

We have acted for:

  • companies reorganising their group structures
  • shareholders with exit strategies (property/tax/sale of business)
  • fund management businesses.

Our restructuring & recovery services team has experienced professionals dealing with members' voluntary liquidations. Our approach is heavily focused on meeting our clients' requirements and concluding the members' voluntary liquidation as quickly and efficiently as possible.

Creditors' voluntary liquidations

We offer the necessary advice and support needed to help shareholders through the liquidation process.

We can assist clients in managing the process of taking the practical steps to conclude the company's affairs and appoint a liquidator.

We can undertake the following.

  • Advise the directors of the company on their statutory responsibilities and assist them in placing the company into liquidation.
  • Assist in the preparation of the statement of affairs of the company.
  • Accept appointment as liquidator of a company and deal with the realisation of assets, the payment of creditors and finalising the company's affairs.
  • Attend creditors' meetings for companies where a debtor is in the process of being placed into liquidation. We will report back to the company on the prospect for recovering their debt. We do not charge a fee for this service.

Court-appointed liquidations

Court liquidations are instituted by an order made by the High Court, usually on the petition of a creditor, the company or a shareholder.

We provide advice and assistance to shareholders and/or creditors where a liquidator is appointed by the High Court or where they are considering entering into the process of appointing a liquidator.

We can assist in the following ways.

  • Advise the directors, shareholders and creditors in relation to the appointment of a liquidator by the High Court.
  • Advise directors of their statutory responsibilities pre- and post-liquidation.
  • Assist in the preparation of the statutory documents including the statement of affairs.
  • Accept appointment as liquidator of a company and deal with the realisation of assets, the payment of creditors and finalising the company's affairs.

Examinerships

This process involves seeking High Court protection from creditors for a limited period, while an independent court-appointed examiner considers the options for a survival package. We accept appointments as examiner and provide an examinership advisory and support service to creditors and banks, or anyone affected by an examinership and who wants independent advice and support on protecting their interests.

We formulate a scheme of arrangement whereby the company can be restructured with a view to survival and consequent saving of jobs. We focus on managing the process professionally and efficiently, while resolving statutory and compliance matters. We strive to achieve the best possible outcome for all stakeholders, given the precarious state of the business and its financial position.

Receiverships

Our clients are principally financial institutions and debenture holders. The function of a receiver appointed by a debenture holder is to take possession of the assets subject to the debenture holder's charge and realise these assets to pay off the debenture holder.

We focus on selling the business/its assets to maximise the return for the secured creditor. We have the relevant skills and knowledge to tackle complex receivership projects, having managed significant receiverships in the past.

In cases of commercial dispute we are experienced in acting under the direction of the court as receivers.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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