Informal arrangements

BRI Ferrier can facilitate informal arrangements for financially distressed businesses as an alternative to administration or liquidation.

Informal arrangements might include:

  • negotiation of standstill agreements with financiers
  • repayment agreement or limited moratorium between a distressed business and its creditors
  • stabilisation of business and identification of risk factors
  • assessment of management
  • compliance reviews
  • cash flow and working capital reviews
  • funding and other financial reviews
  • divestment of certain business operations or assets
  • implementing restructuring
  • developing an operational and financial restructure plan.

As informal arrangements usually don’t require third-party involvement, they can be a cost-effective option. They may, however, offer only a short-term solution.

Here is just one example of our experience in facilitating an informal arrangement:

 

CASE STUDIES

Forest Resort

BRI Ferrier was engaged in April 2014 to assist Forest Resort, which operated a business in Victoria’s central goldfields region comprising a 143-room Novotel hotel and conference centre, a championship golf course, a land subdivision and a waste-water treatment plant (WWTP). Key areas of concern were a cash burn of over $1 million per year, static revenue levels and ongoing poor trading performance, incomplete and poorly maintained development, declining hotel service standards, fractured ownership and the WWTP. We traded the business to stabilise operations prior to marketing for sale, improved hotel operations and marketing, streamlined the room owners’ return model, stabilised the golf course short-term trading performance, maximised land sale value and closed the WWTP. Sale of the resort settled on 5 November 2015, at a price almost 50% above the most recent independent valuation.

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