RestructuringTurning the tide in good time. Navigating through crises.
If you need support with a specific problem, we are a professional partner that works side by side with you.
Do you urgently need answers to your livelihood security or reorganization questions? Then find out more about our services in restructuring and change situations.
Do you need urgent answers to securing your company’s future or reorganization questions? Then check out about our services in restructuring and change scenarios.
When a company's existence is at stake, you quickly need an unbiased view of the true state of affairs to draw the proper conclusions and chart the right course of action. We will sharpen your focus on what is required and offer viable restructuring solutions, together with prompt and smart action, from planning validation and an Independent Business Review (Quick Check) to reorganization reports in accordance with IDW S6 or BGH case law, interim management as Chief Restructuring Officer (CRO) to reorganization solutions or insolvency-related advice.
Integrated corporate planning is at the heart of effective business management. A sound plan creates the transparency needed to implement a company’s strategy and allows prompt countermeasures to be taken at an early stage if needed. When important corporate or financing decisions need to be made, banks will usually require validation of corporate planning arrangements by an external expert.
Having your financial planning arrangements checked by AURICON ensures the plausibility of your planning through an independent assessment, thereby creating confidence among banks and other stakeholders.
Our planning appraisal process normally involves:
- An analysis of the historical and current net assets, financial, and profitability status
- A review of the planning methodology as well as the technical accuracy and completeness of the integrated financial plan (formal plausibility check)
- A review and confirmation of the basic planning assumptions (substantive plausibility check)
- A summary appraisal of the company’s corporate planning arrangements
When considering reorganization and other structural, capital and investment decisions, the aim is often to create professional transparency about a company’s net assets, financial and profitability status as well as its market position in a short period of time.
Typical contents of Independent Business Reviews or Quick Checks are an:
- Analysis of a company’s net assets, financial and profitability status, including a critical appraisal
- Analysis of the company’s corporate structure and business model
- (Indicative) assessment of the company’s market and competitive situation
- Analysis of a company’s commercial performance-related structures
- Analysis of integrated corporate planning arrangements and, if necessary, preparation of scenario assessments
- Analysis of debt service capability
Our Quick Checks/Independent Business Reviews are tailored to the client’s particular circumstances, depending on a company’s size and complexity, as well as the desired scope of the analysis and assessment. They serve as a valuable decision-making tool for the stakeholders.
Negative market, profit or liquidity developments may result in a company being forced to reorganize itself and/or restore profitability or liquidity. This is usually accompanied by increased time pressures and the need to respond flexibly and proactively to adverse events before the company finds itself in the middle of a (severe) crisis with stakeholders potentially requiring the preparation of reorganization reports and greater control of the company. At the same time, there is usually a lack of staff resources and related experience. We will support you in the development of restructuring solutions both holistically and professionally. The starting point is usually a detailed analysis of the root causes in which we first identify internal and external influencing factors from which to devise suitable strategic, operational and/or financial measures to stabilize the company as soon as possible and get it back on track.
Potential starting points for developing a structuring solution are:
- Strategic measures such as the identification of “value drivers” or “value destroyers” within the product portfolio or the derivation of turnaround levers in relation to the value chain
- Operational measures such as the identification of cost reduction potential in materials and personnel as well as in relation to other operational costs
- Financial measures such as the identification of measures to free up liquidity through working capital optimization or optimizing the financing structure
If a company gets into difficulties, external stakeholders will often demand the preparation of reorganization reports by independent third parties. A report must show that a profitable reorganization will guarantee a (re-)financing of the company or the maintenance of current credit lines already approved.
We develop reorganization solutions and expert opinions in accordance with Standard no. 6 (IDW S6 - Requirements for the creation of a restructuring report) drawn up by the German Institute of Public Auditors (German abbreviation is “IDW”), which, at the same time, are also in line with the principles developed under the Supreme Court’s jurisdiction.
Typical core elements of a reorganization report are:
- Presenting baseline information on the commercial and legal starting position of the company
- An environment and industry analysis (market and competition)
- Analysis of the net assets, financial and profitability status
- Analysis of the state and root causes of the crisis as well as an assessment on whether the company is at risk of insolvency
- A presentation of a strategic vision statement with the business model of the reorganized company
- Highlighting specific and effective reorganization measures to avert any risk of insolvency and overcome the corporate crisis as well as developing a mission statement for the reorganized company
- Integrated corporate planning that takes specific restructuring measures into account
- A summary assessment of the company’s reorganization capability
We also develop continuation solutions, which include a continuation forecast in line with Section 252, Sub-section 1, line 2 of the German Commercial Code (HGB).
Restructuring solutions and efficiency programmes are usually initially created on an aggregated level which must first be broken down and operationalized into multiple single measures in order to implement them within sometimes complex company structures. This requires a lot of experience and, in particular, a great deal of time. As companies usually have only limited resources available for managing such programmes due to their busy day-to-day business activities, change processes can often lose vital momentum or fail to gain any impetus in the first place.
We support companies in change processes in a structured and targeted manner in implementing measures which will allow the management team to focus on what really matters, namely their day-to-day business.
Our implementation support services consist of three parts, each of which can be commissioned separetely:
1. Measure Preparation
- Development of new and/or validation of planned measures
- Definition of a clear point of reference
2. Project Management Office (PMO)
- Establishing a Project Management Office (PMO): Organization of staff, responsibilities and interfaces
- Definition of standardized processes and reporting as well as “golden rules”
- Preparation and chairing of regular PMO meetings
- Preparation and moderation of regular steering committee meetings
- Liaison with stakeholders, particularly financiers
- Coordination and prioritization of tasks
3. Project Controlling
- Timely and targeted identification of deviations from the plan
- Development of countermeasures in case of deviations from the plan
- Development of internal and, if necessary, external reporting structures
It is particularly important to keep a cool head in critical business situations. As a company moves closer to insolvency, it is vital that management and all other stakeholders maintain an overview of options for action and their legal obligations. This also includes weighing up judicial procedures as well as out-of-court restructuring. When it comes to the insolvency process, it is essential that the pros and cons of the various types of proceedings in each individual case are thoroughly evaluated and the chosen option carefully thought-out and implemented in a structured way. We act both for companies and alongside insolvency administrators or trustees at various stages of the crisis to help them make the right decisions in extremely difficult circumstances.
The main focus of AURICON’s advisory services is on:
Management and shareholders:
- Asessing a company’s preparedness for insolvency and whether there is an obligation to file for bankruptcy in order to avoid liability risks
- Evaluating and assessing out-of-court restructuring options as well as their preparation and support
- Preparation of statements in line with § 270b InsO for preparing the so-called “Protective Shield Procedure”, (in which the current management remains in charge during the insolvency process) in accordance with IDW S9
- Development of insolvency plans in line with IDW S2
- Ongoing liquidity planning and monitoring
- Development of business plans and restructuring solutions
- Assessment of a company’s ability to continue as a going concern
- Interim management during the (preliminary) insolvency proceedings
- Implementation of sales’ processes (Distressed M&A) within the (preliminary) insolvency process
- Retrospective assessment of the company’s preparedness for insolvency