How to preserve value when troubles mount and crisis looms*
Consider this scenario: Business is going well. Sales are growing and staff numbers have been increased to cope with demand. Share price performance has exceeded expectations. So far, so good.
Then, cracks start appearing – commodity prices increase, market dynamics change, competitive pressures intensify, a major customer leaves, cash levels fall, healthcare and pension costs rise. Other challenges begin to develop: employee underutilization, new facility problems, difficulties integrating systems, late regulatory filings and more. Anxiety replaces confidence. Now, things aren’t so good.
Business trouble can arise quickly and for a variety of reasons. Whether problems are triggered by the marketplace or internally, the price of not identifying and quickly moving to resolve business issues can put a company into crisis.
Companies often exhibit symptoms of distress well before a crisis erupts. In many cases, a downward spiral is not inevitable. It can be arrested and reversed. Early detection and swift, decisive action are the keys to restoring performance and value. That's why timely, professional advice is critical.
If this is your situation
- You need to maintain credibility when the company’s performance is falling short of market expectations
- You must preserve value when margins are shrinking and the share price is falling
- You want to optimize recovery value from an underperforming business unit
- You are facing potential or actual breaches of financial covenants
- You need to stabilize working capital and cash levels
- You are not receiving the right financial information on a timely basis to make informed decisions
- You must control the company’s exposure to losses
- You need to reestablish stakeholder confidence
- You want to better understand the company’s prospective viability and what restructuring options are available
How PricewaterhouseCoopers can help you
PricewaterhouseCoopers restructuring services practice provides solutions to companies and their stakeholders who are experiencing a wide range of difficulties, from weakening performance and reduced operating profit to crises marked by severe cash problems and the imminent threat of insolvency. Experience tells us that, in many cases, businesses can be rescued and the impact of adverse events minimized if professional, objective guidance is sought sooner rather than later.
We are able to rapidly identify problem areas, develop value-preserving, unique solutions and implement them swiftly and precisely. Expertise across nearly every major industry combined with access to an unrivaled global network gives us a depth and breadth that are unmatched in the marketplace.
We develop and implement solutions based on the unique circumstances confronting a company and its stakeholders. Our solutions encompass immediate actions to preserve value and offer longer-term answers to restore performance and rebuild credibility.
Services we provide include:
- Contingency planning/crisis avoidance
- Evaluations of strategic and financial alternatives
- Turnaround business plan development
- Liquidity management including working capital reduction
- Operating efficiency and margin enhancement
- Capital structure/debt capacity analysis
- Chapter 11 advisory
- Plan of reorganization development
In addition, depending on the specific needs of the situation, PricewaterhouseCoopers Corporate Advisory & Restructuring LLC1 (PwC CAR) can also offer specialized services requiring a broker-dealer license such as:
- Capital sourcing – refinancing, recapitalization, rescue capital, exit financing, DIP financing, bridge loans
- Distressed M&A – asset monetization, out-of-court divestitures, Chapter 11 Section 363 sales
- Debt restructuring
- Creditor/stakeholder negotiations
- Buy-side advisory of distressed businesses and assets
- Optimized exit services
The restructuring services practice works with colleagues across the entire firm, from tax and assurance to advisory, ensuring we can provide you with the specialist situational knowledge you need to make the right decisions. The restructuring services practice also draws on our extensive industry experience across PwC to provide an unrivaled combination of restructuring and industry expertise.
Additionally, since our restructuring services team is the US link within the PwC global network of more than 1,000 partners and staff spanning 55 countries that specializes in restructuring services, we can provide detailed local knowledge to complex cross-border restructurings.
1PricewaterhouseCoopers Corporate Advisory & Restructuring LLC is owned by PricewaterhouseCoopers LLP, a member firm of the PricewaterhouseCoopers Network, and is a member of FINRA and SIPC. PricewaterhouseCoopers Corporate Advisory & Restructuring LLC is not engaged in the practice of public accountancy.
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