By Stephan Millard, Product Marketing
Being prepared for a restructuring transaction in today’s economy makes sound business sense. That was one of the conclusions of the panel discussion Datasite held on our June 17th Webinar “Prepare Your Transaction: Refinancing. Restructuring. Rebuilding.” Moderated by myself, Stephan Millard, we had three experts on restructuring provide advice on how to assess your current circumstance, how to pick the best strategies for your business and what you can do today to be prepared for restructuring.
The global economy is not like any we have seen in recent times. The corona virus pandemic has had a major impact on economies around the world. In the US, business bankruptcies are up by 48 percent in the US in May and many companies around the globe in segments like retail, hospitality and others are struggling. All of our panelists and over nine in ten (93%) of the respondents on the webinar said they expect the need for restructuring transactions to increase in the next 12 months.
The first thing companies need to do is assess their current circumstance. How? All agreed - find advisors that know restructuring and who have been in the trenches doing the hard work with companies around the world. Don’t try to go it alone.
Success picking the right strategy, as Joseph Weisglass described, can be a like a football game. A good advisor is like a good quarterback. They have a range of plays at the ready from conservative plays to the ‘hail mary’ play. Your advisors know what play to call because they are thinking about the other teams on the field and how they will react.
It is also important to know how many teams are on the field, as Tal Unrad pointed out. As companies become less solvent, they may also have the creditors on the field. This can change the nature of how the play will work and which plays are available.
Preparation is about taking the initiative, being proactive and driving to your preferred outcome.
What can you do now? Andrew Grimstone offers some sound take aways: