Debtor advisory

Overview

Businesses that want to raise debt finance, refinance, or obtain waivers and amendments to existing finance arrangements, can face an unpredictable response from their lenders, even if their banking relationships have historically been strong.

From family owned businesses to multinational corporations, we have considerable experience helping companies in financial distress. Whether it’s dealing with the demands placed on them by their lenders, or coordinating and negotiating on their behalf with creditor groups, the ultimate objective is always to reach a workable solution with all concerned parties.

We work with management to deal with financial underperformance by stabilising the business, managing key stakeholder relationships and building a strong platform for the future. We can help you to focus on your working capital cycle to maximise liquidity and free cash flow.

We can introduce experienced turnaround professionals to take on executive or advisory roles, such as non-executive directors, advisors/mentors to boards and operations.

When listed companies are experiencing financial difficulties and their shares are suspended from trading on the Hong Kong Stock Exchange, we can assist in the process for resumption of trading. We do this by taking them carefully through the requirements of the Securities and Futures Commission and the Hong Kong Stock Exchange, sourcing potential investors and taking a hands-on role should a formal insolvency proceeding such as Provisional Liquidation or Scheme of Arrangement be required.

 

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Potential issues

Whatever the cause of your challenges, if any of the following symptoms affect your business we think our expertise could help: 

  • a credit rating downgrade is looming
  • the company is trading at distressed levels
  • you need to enter into discussions with your lenders to reschedule loans
  • a key stakeholder group has lost confidence in the existing team and is demanding repayment or change
  • your board members or senior management have departed
  • you lack the resources to cope with the additional pressures of managing the business in its current situation
  • you want to raise funds, or refinance, by selling part of, or the entire share capital of a listed company, or
  • as a stakeholder in a distressed business, you need to manage your exposure, both legal and financial.

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Support

How we can support you

We believe in working closely with senior management and the Board as early as possible. That way we can help to define and develop a comprehensive range of financing solutions. We then work with you to assess each option and assist senior management when it comes to implementing the preferred solution.

Services for companies experiencing financial difficulty:

  • Negotiating amendments to existing finance terms, including covenant amendments and waivers, and debt rescheduling.
  • Advising on the appropriate form and structure of the company’s restructuring plan, with the aim of negotiating continued support from lenders.
  • Providing optimal value for corporates by disposing of, or reinvesting in, a non-core, or under performing asset, or in a distressed business.
  • Leading the debt restructuring and turnaround process and coordinating the work of all other professionals involved.
  • Acting as the link between the company and its lenders to enable the company’s senior management more time to focus on running the business.

Interim management:

  • Introduce new management to provide leadership to the business during the turnaround phase.
  • Manage stakeholder relationships while the CEO remains in control.
  • Provide operational support, such as building a business plan that is supported by actions including key performance indicators for short to longer term strategies to achieve recovery and growth.

Debt restructuring and resumption of trading:

  • Analyse the financial situation of the company and advise on the options for resumption of listing status.
  • Advise on any regulatory requirements of the Securities and Futures Commission and the Stock Exchange of Hong Kong Limited.
  • Advise on any announcement(s) to be made in relation to the company's current and future financial position, including liaising with the Stock Exchange and Securities and Futures Commission on the company's behalf.
  • Finding potential new investors and potential buyers of group assets/businesses, and, if desired, negotiating with them on the company’s or shareholder’s behalf.

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Our Experience

  • Acted as the provisional liquidators of a company listed on the Stock Exchange of Hong Kong, Singapore and Taiwan. We preserved the assets of the company and invited interested parties to submit restructuring proposals in order to resume trading of shares.

  • Acted as the advisor to provisional liquidator in Bermuda of a listed group engaged mainly in logistics and distribution of petrochemical products in Asia Pacific, especially in the PRC. The group employed over 510 employees and had USD1 billion of debt.

  • Acted as the financial and interim management advisor to a government body on the restructuring of one of the largest public bus operators in Macau with over 500 employees and 250 buses. Involved from take-over planning to sales of assets, to introduction of new investors. Total investment by new investor: MOP190 million.

  • Acted as the interim general manager of a company to stabilise the business from prior mismanagement. New workplace policies introduced and operations were streamlined to build a foundation for sustainable future improvement.

 

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Related services

Contact us

Ted Osborn
Restructuring and insolvency Leader
Tel: +[852] 2289 2299
Email

Victor Jong
Partner
Tel: +[86] (21) 2323 3650
Email

Christopher So
Partner
Tel: +[852] 2289 2577
Email

Marie Rowbotham
Director
Tel: +[852] 2289 2504
Email

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