I was approached by the board of directors of a £30m+ turnover company in the drinks distribution sector to provide independent advice to them during the period immediately following an Independent Business Review.
The review had been carried out by a firm Insolvency Practitioners on behalf of an Asset Based Lender. The company had breached a number of lender covenants and was unable to continue to trade without further support from its funders which they were not prepared to provide without further assurances the IBR was intended to provide.
My initial role was to provide independent advice and support to the board to help them understand the process, its implications and to deliver the targets set by the process. The initial brief had been to seek a non-insolvency exit with the support of the principal stakeholders (the funder and creditors). As the process evolved it became clear that the legacy debt and resulting curtailed trading position of the business made this impossible.
My brief changed to one of working for the board to assist in a controlled exit of the business through administration. I advised the board on proceeding with negotiations with interested parties prior to appointment. This process was undertaken in full consultation with the IP and the stakeholders. Working closely with these parties intensively over a compressed period of time with a managed exit was found that preserved a significant part of the business and jobs.
During this engagement in addition to providing technical advice across the areas of insolvency, business support, creditor management and forecasting I became responsible for communication between the board and the stakeholders as well as with the staff who were understandably distressed by the events and needed to be kept fully informed and engaged to preserve the potential for a sale of the business in whole or in part.