Case Studies.
Independent corporate crisis and financial distress advisory delivered with experience, agility and level-headed expertise.
Board and C-Suite Advisory
Project Lighthouse
We were engaged by a major motor vehicle manufacturer suffering declining sales and economic viability in the Australian market. Our mandate was to consider alternative operating models and to develop a contingency exit plan.
After working with the offshore and onshore management teams to analyse European market trends and how those models could be developed in Australia, we developed an exit plan that included an exploration of any legal and brand risks associated with that approach.
Following analysis of the exit plan and the associated risks and costs, management adopted the alternative business model to improve dealership and manufacturer profitability and continues to operate in the market today.
Project Brooklyn
We were engaged by the board of directors for a listed financial services company undergoing significant financial stress caused by interest rate and regulatory changes, along with broader financial complications arising from the near-term maturity of over AUD3bn of debt.
We provided Safe Harbour advice to the board and assisted it in managing the competing debt maturity risks and operational improvement plans. This allowed the pursuit of a capital raise to facilitate a restructuring of the debt facilities.
The business avoided insolvency, successfully raised new capital and restructured the various debt instruments into a more sustainable maturity profile. The changes in the financial environment allowed management to implement product changes and the company remains a market leader.
Creditor Advisory
Project Luff
We were engaged by the private equity owners of a major therapeutic goods manufacturer who were keen to avoid an impending insolvency given the value destruction that would be caused with that approach.
We worked with management, the board of directors and the private equity investor to develop and test a restructuring plan that required the injection of new capital in a way that was capital-protected considering the imminent insolvency threat.
The manufacturer successfully implemented the restructuring plan which allowed the private equity investor to recover their finance lines and to pursue a sale of the business.
That sale resulted in the private equity partner recovering all debt and also a strong return on its equity investment by avoiding insolvency
Project Sol
We were engaged to report to the financier of a leading aged care provider on the true state of business operations and to develop a non-insolvency exit pathway given its vulnerable customer base and PR concerns.
Major changes in management and financial stress caused by the rollout of a failed technology platform were leading to covenant breaches, solvency concerns and the apprehension that customer ‘wallets’ were not supported by adequate cash reserves.
We sought an orderly pathway for the financier to support the business whilst it stabilised the management team, deployed an operational restructure and pursued a successful capital raise.
The financier was able to exit the loan and write back the loss, the business continues to operate today, and no customer suffered any loss.
Insolvency
Lehman Brothers Australia Ltd.
The Australian operation of Lehman Brothers held over AUD 1bn in complex financial instruments which were substantially impacted by the global financial crisis (GFC) and global litigation.
As the appointed Liquidator, a strategic plan to legally pursue counterparties globally and to unwind the complex securities were deployed resulting in the successful return of over 100 cents in the dollar for Lehman-issued products.
An efficient claims determination model was also developed to manage complex financial product claims, which has become a market practice for the remediation of financial product miss-selling claims.
That model was implemented as a scheme of arrangement that incorporated settlements with other global counterparties to the benefit of the creditors.
I Pipe Group
After a major dispute with a contractual counterparty, a specialist in the construction and maintenance of pipelines, wellhead and compression facilities in the coal seam gas space was placed into administration.
As the acting administrator, Marcus Ayres supported the business in a financially constrained environment which avoided both an immediate shutdown of operations and termination of all staff whilst a sale was pursued.
The business was sold to a market-leading player in the oil and gas sector allowing for the transmission of the business and major contracts to the buyer, and also for employees to be provided ongoing employment.
This avoided major redundancies and provided continuity for customers thereby avoiding significant damages claims.
Note: Some of the case studies were led by our team whilst at a previous firm.