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Restructuring and Operational Turnaround

Our restructuring and turnaround services are intended to assist clients in their response to distress and complex issues. During a crisis, the top priority for management is to stabilize existing operations, minimize risks, and preserve and optimize capital structures.

Warning signs may come in many forms, with some more significant than others, and include breach of debt covenants, issuance of profit warnings, deterioration of cash metrics, and over leveraging of the business. Different signs will draw different degrees of concerns from bank creditors, non-bank financial institutions, other creditors or other key stakeholders regarding the preservation of the company’s key assets.

Our Restructuring and Turnaround team advises clients with complex financial and operational restructuring and turnaround initiatives, and our services accelerate an improvement in liquidity, credit availability and returns to stakeholders.

EY - Restructuring and Operational Turnaround

Our services include:

  • Restructuring of Distressed Company
    • A company is facing financial distress when it has an over-leveraged capital structure or working capital constraints. The company may require an additional capital injection, debt restructuring, disposal of under-performing department(s), or intensive working capital management
  • Restructuring Advisor to Creditor(s)/ Investor(s)
    • Creditors/investors identifying financial or operational crises in their debtor or investee, for example, a breach in a financial debt covenant such as payment default, has occurred in the target company, and therefore advice/ involvement of professional restructuring services is needed
  • Formal Bankruptcy Restructuring/ Bankruptcy Conciliation/ Liquidation
    • The company enters into bankruptcy restructuring or bankruptcy conciliation/ liquidation, administered by a third party appointed by the courts
  • Disposal of Distressed Assets/Distressed Loan Advisory
    • Banks and non-bank lenders disposing of distressed loans/debt portfolios or single large credit in an efficient manner in order to manage capital requirements
  • Supply Chain Crisis Management
    • Major supplier(s) unable to continue supply contracts, and where there is a limited amount of alternative suppliers available in the short term. Professional team required to manage, monitor and coordinate completion of orders in a timely manner
  • Operation Improvement of Distressed Company
    • Companies facing temporary liquidity issues and requiring assistance to improve short-term working capital and advice on underlying profitability to improve enterprise value
  • Rationalization of Legal Entities
    • Enterprise groups wishing to streamline entity structure, improve management efficiency and lower operating costs
  • Monitoring of Company Finance
    • Monitoring financial performance on a daily basis and building management information
    • reports to assist management in strategic decision making
  • Distressed Assets M&A Advisory
    • Assisting investors to acquire distressed assets in China
    • Debt restructuring,, asset disposal as well as business operational restructuring. Advising and executing on distressed acquisition and disposals

Type of client│Main scope of services

  • Multinational Corporation
    • Supply chain crisis management
    • Optimization of legal entity structure within a group
    • Restructuring of distressed subsidiaries in China
  • State-owned Enterprise/ Privately Owned Enterprise
    • Company deleveraging including debt and equity restructuring
    • Company restructuring advisory and investor financial advisory covering distressed domestic legal entities and cross-border investments
    • Operation improvement of distressed companies
    • Supply chain crisis management, including overseas suppliers
  • Private Equity Fund
    • Advisory service to investors on target company restructuring
    • Protection of shareholder's interest in the event of bankruptcy restructuring/conciliation
  • Government
    • Coordinating deleverage of companies under a jurisdiction
    • Monitoring restructuring of distressed enterprises, maintaining a stable economic and social environment
  • Banks and other creditors
    • Advising creditor(s), reviewing and analyzing debtor's balance sheet and ability to repay debt, designing restructuring options, monitoring debtor’s cash flow
    • Assuming administrator's role under bankruptcy restructuring/conciliation
    • Advising creditors under bankruptcy restructuring/conciliation procedure, coordinating/supervising administrator duty, protecting creditors’ interest
    • Distressed assets/loans advisory, accelerating disposal work

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