Our services are rooted in our experience with businesses in crisis. Our professionals have encountered many special situations over decades of experience. Our experience can benefit your business, even if your business is not in crisis. If not addressed, minor challenges can become mission critical. Most of the crisis situations we encounter are the result of a series of adverse events that are not adequately addressed. We have had significant success working with businesses in crisis, but we achieve better results when we are engaged earlier in the life cycle. We have the skills to address the challenges immediately after they arise, or after the situation has reached a tipping point.
Every business has a start, and every business has an end.
Our services help after the beginning, but before the end, and depend on your position in the lifecycle.
Board Level Strategic Advisory Services
Many middle market businesses miss the opportunity to utilize an effective tool for planning and monitoring financial performance. Objective, outside (non-executive) board level strategic advice is critical in achieving world-class business performance. There are two types of boards – governing boards and advisory boards. Governing boards are mandatory boards required to maintain compliance with corporate governance rules. Advisory boards are voluntary boards that are created to provide strategic guidance. Both, whether individually or used in combination, can provide management of closely-held business a method to maintain their field of vision and to not be trapped by past events.
We provide advice at the board level, and will serve as members of boards of directors or boards of advisors. We also assist our clients in developing viable strategies for forming boards that will provide owners and executive management with valuable input on effective strategic planning and tools to hold executive management accountable for results.
Business Assessments and Performance Improvement
The business landscape is constantly changing. Businesses that adapt are the most successful and have the longest lifespan. Often, a simple, objective assessment of a business will provide owners and managers with insights that will better inform their thinking.
We focus on business fundamentals and typically evaluate businesses in the following areas.
- Operations – efficiency, margins, supply chain and lean operations
- Financial – benchmarking, segment analysis, overhead and re-engineering
- Cash flow projection and management using our proprietary rolling 13 week cash flow model
- Key performance indicators (KPIs)
- Exit strategy
The true value in our services is unlocked by implementing the solutions identified in our analysis. We look for solutions that can be implemented and apply our findings to assist our clients improve their operational and financial performance. We want our clients to feel the benefit of our services and not simply receive a report full of suggestions. We understand that the difference between success and failure is execution, and our team has the expertise to successfully execute performance improvement strategies.
In some cases, a transaction is the best method for resolving a challenging financial or operational situation. A business transaction is a stressful experience, even under the best of circumstances. Through experience gained over hundreds of transactions, the r² advisors’ team is skilled at keeping those involved focused on the critical aspects of the transaction, including identifying the positive characteristics of a challenged business. We have experience working through mergers and acquisitions transactions where timing and execution are unusually important and the margins for error are thin.
We provide expert guidance and hands-on assistance to make sure a transaction is completed in a professional and timely manner. These transactions occur in and out of court supervised processes, and our team is skilled in both environments. Sometimes they involve asset sales, a restructuring-by-transaction or the acquisition of businesses that are under-performing to take advantage of a price opportunity, whether horizontal or vertical. We also maintain relationships with many industry players and have the ability to bring resources to our clients’ special situations.
Restructuring and Crisis Management
In some situations, a restructuring, turnaround or crisis advisor becomes necessary. With the wider use of leveraged finance, there is greater pressure on businesses when projections are not met. We are experienced in successfully working with businesses and their creditors to resolve situations where debt is preventing an otherwise viable business from achieving satisfactory performance and threatens its survival.
Although we are highly skilled in bankruptcy processes, we attempt to use every avenue available to achieve a business-centric resolution outside of court proceedings. With our knowledge of bankruptcy reorganization, our efforts are focused on developing and implementing out-of-court workouts. Our professionals are capable of emulating or employing bankruptcy restructuring concepts without a formal bankruptcy reorganization. If bankruptcy is necessary, we provide expert guidance to help our clients navigate the bankruptcy court-supervised process.
r² advisors’ professionals have CEO, COO, CFO and CRO (Chief Restructuring Officer) experience in businesses that are in transition, are experiencing difficulty, or are in crisis. Our team members have successfully operated businesses that were at or near complete shutdown, working to restart these businesses and guide them back to profitability. The professionals at r² advisors can assume interim executive officer roles to help implement a successful turnaround or workout strategy. Typically, these assignments involve two distinct functions:
- Serving as an interim manager, which includes reporting to the board of directors and outside constituents such as creditors; and
- Providing financial analytical support to facilitate important decisions that are made during a turnaround or workout.
In these situations, ongoing business operations require the full-time attention of the incumbent operating team. The restructuring matters require a different skill set, and require significant time, making it infeasible, or imprudent, to require existing management to take on additional responsibilities. Our team can assist existing management to form an effective team to work through restructuring while maintaining ongoing business operations.
Creditor Advisory Services
Creditors who are involved with companies in financial distress often seek specialized advice to assist them in developing and refining effective recovery strategies. Because of our experience, we can help our clients understand the options available to them to recover their debt. We often work alongside our clients’ legal counsel to create a harmonized recovery strategy that involves business and legal concepts. We believe that these comprehensive strategies yield cost effective results as compared with a one-dimensional strategy.
r² advisors also has experience providing financial advisory services to creditors’ committees, including those formed outside of bankruptcy or official committees formed as part of the bankruptcy process. When representing committees, we employ the same analytical tools used when involved with a single entity, however r² advisors understands that the group dynamics inherent in such situations can pose unique challenges. We understand that every committee member has slightly different priorities and perspectives. Our team works to find optimal solutions that maximize return and are otherwise acceptable for all, or a majority of, creditors.
Business Windup Services
In special situations where a business cannot or should not remain in operation, r² advisors’ professionals have been engaged to facilitate and manage the windup of an enterprise. Business terminations typically occur in one of two ways. The first is for the filing of a Chapter 7 liquidation. The second is through an out-of-court windup process. Often, stakeholders derive no benefit from a Chapter 7 bankruptcy, and prefer to windup their business in an organized manner, using the services of a qualified, objective third party.
We provide assistance in situations where a business must be wound-down over time, and incumbent management does not want to be involved. We understand the stressful nature of a business termination, and work hard to insure that the process is handled professionally.