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and financial restructuring. liquidity as opposed to profit in order restructuring plan”.
“Typically, operational and financial to stabilise the organisation. Le Berre What is loud and clear is that for any
restructuring projects have different time says that its consultants also have the company that is floundering, regardless of
constraints. So for operational experience to know how feasible it is sector or location, the imperative is to
restructuring project, you would need to arrange different types of funding, be recognise the problem. “Don’t assume that
12 to 24 months before you could start that a rights issue for a public company or you can afford to wait until the next
to see the results, whereas the results of a some form of asset-based lending for a month or the next quarter as chances are
financial restructuring may be required retail concern. the circumstances will be more difficult
within a matter of months, if not weeks. One trend he identifies in the market is tomorrow than they are today.” ■
When both are dealt with separately and a number of private equity firms seeking
you are not sufficiently coordinated, you to invest or reinvest in companies – a sign
end up lacking the necessary balance that just because a company may have lost
to move the business forward.” its way, it doesn’t mean the intrinsic value
of the business can’t be rediscovered in
HOLISTIC APPROACH the long run. “There is definitely activity
Le Berre stresses that while it is important among the private equity firms,” he says,
to understand a business as a whole entity noting that inevitably there are also a
and not look at it in silos, it’s important to number of players seeking to purchase
focus on what the main problem is with the right kind of distressed asset.
any particular company. “We will As for Huron, Le Berre expects the wide
concentrate on one area. Sure, we take an variety of work to continue apace. He
objective view of the entire business, but gives the examples of working with an
then we discuss in conjunction with international automotive supplier where
senior management or investors what it is the firm has conducted an “operational
they think we can do for their business.” restructuring diagnosis and the following
If a turnaround or restructuring is to action plan to be implemented”, and
succeed, then key stakeholders will often elsewhere Huron has assisted creditors
have to rethink the business’ priorities. of a distressed company by confirming
This may mean focusing on cash and the validity of the management’s “existing
Mergers & Acquisitions 27
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