ERS European Restructuring Solutions provides a wide spectrum of consulting services to help companies in special situations to achieve their strategic and financial goals. We are highly specialised in local consulting processes and legal proceedings and equally versed in cross border issues. Our professionals’ breadth of experience and depth of understanding of our clients’ businesses and industries allows us to adopt a multi-disciplinary approach to problem solving, and provide solutions that guide companies toward sustainable growth.
All turnaround situations are not just limited to troubled companies and turnaround opportunities exist in most companies. In our changing global economy there are many factors that can impede performance improvement. Rising costs, rapid expansion, increased competition and changes in consumer demand will have varying degrees of impact on a company. At ERS our approach is to work closely with a range of stakeholders – investors, management, and lenders to support the company to unlock value in challenging situations. Many of these challenging situations are unique to the individual company and require a tailored approach. In order to unlock value we typically undertake a performance and organisational review to understand where these challenges lie. Our teams comprise highly experienced senior executives who have not only faced many challenges in their work careers but who also adopt original thinking in their approach and who have a track record of success.
Almost every corporate crisis starts with strategic uncertainty which can lead to operational inefficiency and end up in financial and liquidity problems. Especially in today’s global economy with fast changing business models and new competitors attacking traditional sectors with innovative solutions. To be one step ahead in this challenging environment a neutral and trusted partner is needed. A systematic revision of strategies thus lies at the very core of any company in a special situation. Because of ERS’s senior level experience in multiple sectors we have the ability to think out of the box. ERS will assess existing strategies and adjust them with concrete measures. These measures are defined and implemented by means of robust planning. A monitoring process secures the realisation of the strategic change and therefore a sustainable competitive advantage.
Companies in distressed situations usually operate with high cost structures and inefficient value chains. The consequences are competitive disadvantages and loss of profitability. In the worst case it ends up with financial and liquidity problems. ERS supports companies working directly with the management to regain operational performance. The centre-point of successful cooperation is a joint project approach that enables an interface to functional management. In this way, fields of expertise can be supplemented in a targeted approach and existing company resources used efficiently. Because of our interdisciplinary approach with experienced managers, accountants, engineers and lawyers, we are able to develop and implement comprehensive profitability plans. These plans include optimisation programs for marketing and sales performance, purchasing and supply chain management, working capital management and manufacturing efficiency and the personnel organisation. Every measure is defined by means of concrete planning. A respective monitoring process ensures the realization of the benefits and therefore the recovery of operational excellence and profit.
Integral to restructuring of underperforming businesses is alignment of the capital structure to the new reality with a credible business plan demonstrating profits and cash flows available to service debt levels. Constructive discussions can then take place with creditors and potential new capital sources to restructure the debt. Solutions are varied and dependent on the security and priority of existing creditors, and the availability of assets and future cash flows. This may be debt converting to equity and may involve some debt forgiveness. Debt may be structured as senior secured or junior with different levels of security and interest rates. Where future growth is forecast requiring increased working capital, ABL lending (asset based lending) is often a preferred option. Understanding of a bank’s position, normally a secured creditor, and its assessment of risks and recovery is essential to successful negotiation. Negotiations are influenced by each parties’ commercial and legal leverage. A debtors position will be enhanced with skilled and experience professional support.
Studies of recovery rates from insolvency process versus consensual restructurings demonstrate that consensual restructurings preserve greater value and greater recovery for creditors, whilst also saving jobs and goodwill and limiting collateral damage in suppliers and customers. Most EU jurisdictions have recently introduced legislation to facilitate consensual out of court restructuring. Application of both the legislation, and negotiation skills with creditors and stakeholders with the experience of delivering improved value preservation can depend on the professional advisers engaged.
We provide legal advice for restructuring operations for large and small companies, both solvent and insolvent. In order to carry out these operations, we are able to offer effective solutions in the different practices required in restructuring, corporate, labour, tax and financial.
Our expertise covers advice on contingency planning, insolvency filing requirements, debt restructuring, distressed financing, distressed acquisitions and sales, credit bidding, formal insolvency proceedings, out-of-court restructurings, corporate reorganisations and refinancing and distressed debt trading. We advise lenders and investors at all levels of the capital structure as well as directors, insolvency trustees and government institutions.
We have wide experience in providing services related to mergers and acquisitions, structural modifications of companies and strategic definition for investments and divestitures. We continuously assist companies in the commercial area of their daily activities, leading council secretariats and in some cases acting as nominee directors and liquidators. We can also offer advice to financial and industrial investors in company assets and liabilities when these are in pre and post-bankruptcy procedures.
Planning, expertise and management makes as leaders in consulting and resolution of labour law proceedings and labour force adjustment plans carried out in the context of restructuring operations are included in our services.
Our advice takes into account all tax aspects of companies and business entities on an ongoing basis. We advise our international clients on domestic and international taxation while monitoring the legislative initiatives of the EU and the impact of the CJEU case law on taxation. We collaborate with our clients in planning for Customs and Indirect Taxation.