Description
Book SynopsisOver time, business distress has become more common and more unpredictable. European restructuring’s default position has historically been insolvency, but all too often this has destroyed value and brought little, if any, unsecured creditor recovery. Influenced by US Chapter 11 and “debtor in possession”, restructuring professionals sought better ways to enhance value preservation. As a result, consensual turnaround and restructuring ahead of insolvency is becoming Europe’s new default position. This practical book draws upon the author’s 25 years’ experience in turnaround management and guides the reader through the key issues including staunching cash burn, creating cash generation, identifying viable business elements, eliminating loss-making sectors and excess cost, and identifying a revised strategy, a credible business plan and the management team to implement them. The importance of stakeholder management is emphasised and covers the role of creditors, suppliers, customers and employees, as well as a comprehensive explanation of how new sources of finance and debt rescheduling can leave a balance sheet consistent with the business plan. In short, Turnaround Management is the perfect guide to help you navigate the benefits of turnaround rather than insolvency. Author Alan Tilley is currently chairman of BM&T. Before this he was managing director Europe at Glass & Associates. He is a chartered accountant, a certified turnaround professional and has won a number of turnaround awards. Alan has also held key positions at TMA Global, TMA UK, TMA Europe and the European Association of Certified Turnaround Professionals.
Trade ReviewA must have book for any turnaround professional. -- Mike Measures * FCA *
The book is a very useful tool when addressing underlying business problems, managing managers’ overconfidence, developing a turnaround business plan, identifying a revised strategy and what it needs to get the management team to implement these plans, including some war stories, eg La Seda de Barcelona. -- Professor Dr Bob Wessels
Based on the author’s extensive experience in over 50 major turnaround cases over 25 years of practice, this text serves as a compendium of what to do and what to avoid. It looks at the rise of turnaround management as a specific function, appropriately distinguishing the roles of formal insolvency and pre-insolvency procedures, especially consensual procedures, and at understanding that not all cases of financial distress need be resolved by recourse to law. Where, increasingly, law has moved in to stake a position, the author charts the various regimes encountered and their merits or demerits. What makes this work particularly notable is the author’s reference to case studies, many drawn from his experience, and how the materials in each chapter can be understood through analysing real-life scenarios. The text moves through the life cycle of a business, looking at the role of turnaround managers and where their involvement becomes critical, in particular at how the “decline curve” and crunch points must signal the need for action. Essential pre-requisites for a successful turnaround are listed, particularly the role of adequate information and identifying priorities for action. Assessing enterprise value and resolving the problems that have led to distress form a natural part of the work leading up to a business plan, in which issues such as managerial reputation, negotiation strategies and operational aspects of the restructuring all play a part. How procedures come to an end and the reconciliation of creditor and debtor interests then form the backdrop to the overall conclusion of this work, not forgetting of course the necessary chapter focusing on cross-border issues. In summary, a very useful and worthy text, not simply for the “war stories”, but especially for the distillation of experience and reference to developments in a number of jurisdictions, lending this work a very strong comparative feel. “This article was first published in Eurofenix, the journal of INSOL Europe (edition 76). Further information about Eurofenix can be found at https://www.insol-europe.org/publications/about-eurofenix Further information about INSOL Europe can be found at https://www.insol-europe.org” -- Paul J. Omar * Eurofenix, the journal of INSOL Europe *
Tilley is the quintessential hands-on operational turnaround professional. As such, his book reads like a battle cry in the war to preserve value. -- John Willcock
Table of ContentsForeword 5 Richard Tett Freshfields Bruckhaus Deringer LLP Introduction 7 1. Turnaround managers and their role in corporate rescue 19 2. The decline curve: warning signs and the slide into crisis 37 3. Crunch point: when time and money are in short supply 49 4. Basic requirements for a successful turnaround 61 5. Assessing enterprise value and business viability; consensual compositions 73 6. Addressing the underlying business problems 87 7. The turnaround business plan 95 8. Management credibility and stakeholder management 107 9. Negotiating the financial restructuring: La Seda de Barcelona 117 10. The operational turnaround: La Seda de Barcelona 131 11. International and cross-border complexities 151 12. Turnaround and non-performing loans 165 13. Exiting the leadership role 171 14. Risks and rewards 175 15. Conclusion: the role of turnaround management in seeking to reconcile debtor and creditor interests 181 Appendix – Guidelines and Policy Recommendations, an excerpt from Best Practices in European Restructuring: Contractualised Distress Resolution in the Shadow of the Law 187 About the author 211 Index 213
