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Business Restructuring & Turnaround

If your client’s business is facing financial challenges, often formal Insolvency can be avoided if we are introduced at an early stage. Business Rescue Centre can assist in implementing an appropriate Business Restructuring and Turnaround package.

We start with looking at your client's current business to see if things can be improved within the following areas:

Funding
Are they paying the right rate on their existing funding facilities?
Do the current funding requirements meet the expectations of the business?
Do they have the necessary access to the businesses funding requirements?
Business Rescue Centre has a vast portfolio of lenders and funders which can be accessed to achieve new lines of credit or to reduce cost and obtain a more cost affective package.

Cash Flow Issues
Many businesses cash flow issues stem as a result of poor payment performance or an exposure to bad debt. Our Insolvency prevention tools offer advice and guidance allowing you to implement long term systems to reduce the exposure of your business facing financial challenges.

Key areas of concentration:

  • Improved credit control procedures
  • Time to Pay Arrangements
  • Advice on keeping overheads to a minimum / identify business cost savings

Improved Credit Control Procedures
Many businesses find themselves exposed to poor payment performance and bad debt due to the fact that they still work to the old fashioned regime of providing services or products based on a hand shake. Business Rescue Centre can help you and your client reduce their exposure to bad debt and prevent cash flow issues by implementing more stringent credit control procedures.

BRC’s systems can provide you with the following:

  1. Intelligence on the financial stability of your customer / debtor
  2. Ongoing monitoring of your customer / debtors financial stability
  3. Risk assessments of your customer / debtor financial stability

Time to pay arrangements
Time to pay arrangements primarily refer to a company’s outstanding liability to HMRC, the ‘time to pay’ scheme was initially introduced in 2008 under a Labour Government with the intention of assisting businesses to allow them extended grace in relation to repaying their outstanding taxes and aid the recovery of the economy through recession. This scheme is now being phased out under the Coalition Government and therefore HMRC are reverting to the old regime of ‘pay us or else’. HMRC do still accept time to pay arrangements but not with the ease and flexibility as they did under the time to pay scheme, Business Rescue Centre can help you and your client in the preparation and submission of any time to pay proposal.

Or if their company is in greater financial difficulty than this but not at the stage of insolvency we can attempt a business restructuring & turnaround package in the following ways:

Administration
Distressed business rescue procedures start with the appointment of an administrator (usually an Insolvency Practitioner – IP) and the aim is to rescue the company as a going concern giving them immediate protection from their creditors. This can achieve a better result for the company and creditors as a whole. The administrator will put forward a rescue or restructuring plan allowing the company to keep trading.
If a sufficient rescue plan cannot be put into place then the IP appointed can then sell the business as a going concern, or just sell off the assets of the company. This helps to release more from the assets than in liquidation or release the assets to pay a preferred creditor.

Pre-Pack Administration
There may be an opportunity for the existing Directors or potential investor to purchase the assets of the company for their own ventures. This is known as Pre-Pack Administration which is a powerful business restructuring and turnaround tool.
The business is effectively sold on to a new buyer (such as an investor) or the existing directors or management team without its existing unsecured liabilities. The main advantage is immediate protection from creditors through the courts whilst the administrator sells the business assets and puts the restructuring plan in place. This will enable the continuity of the business for the new owners without interruption and the baggage of the old debts, employees, bad contracts etc.

Company Voluntary Arrangement (CVA)
A CVA is designed to allow a business to trade its way through the financial challenges it may be facing. The aim is for a legal and binding agreement to be reached with a company’s creditors. A five year payment term is normally agreed, for payment of all, or part of the company’s debt, which can be brought to an early conclusion by way of an offer of a full & final settlement.
The binding agreement will:

  1. Freeze interest and charges
  2. Hold off further legal action
  3. Relieve directors and partners of creditor pressures
  4. Allow the company to pay what it can afford when it can afford it and;
  5. The balance to be written off

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Business Rescue Centre Ltd
The Maylands Business Centre
Redbourn Road, Hemel Hempstead
Herts, HP2 7ES

Tel: 01442 233123

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