A tough and volatile economic climate, rapid market changes, new competitors, and disruptive technologies – any or all of these factors can cause financial stress. Left unaddressed, they may ultimately threaten corporate survival. However, as companies often exhibit symptoms of stress well before any crisis ensues, an opportunity is provided to take decisive corrective action.
Financial stress can be caused by a number of different factors. It is critical for companies and their stakeholders to quickly recognise the key signs of stress and take action to preserve value. The key to preserving value for all stakeholders is spotting the warning signs early and obtaining specialist help quickly.
We are able to rapidly identify problematic areas in each crisis stage, develop value-preserving and unique solutions, and then implement them swiftly and precisely in cooperation with the management. These are the key drivers that made PwC the world's largest provider of business recovery and insolvency services. We provide our services to quoted and private companies, state enterprises and government authorities.
Our Business Recovery Services specialists have extensive experience with major restructuring projects in the Czech Republic and the CEE region across multiple industries. The key determinant of our success is the combination of many years of experience, unique abilities and the professional knowledge of our specialists, drawn from the CEE region or broader PwC network.
Our goal is to offer specific solutions that have real impact on clients’ business, rather than producing theoretical reports. We, therefore, create unique value that does not compare to any other service on the market. Business Recovery Services team utilises extensive professional experience shared across the global PwC network, adapting it to client needs at the national and international level.
Where businesses are underperforming, in distress, or in crisis, we provide tailored business review services either for financial stakeholders or for the business itself. We offer output in the form of objective analysis that evaluates the fundamental viability of the company and serves as a platform for finding solutions among stakeholders (lenders, management, shareholders, etc.).
Assuming that the company knows the causes of decline in performance or crisis, it can react by preparing and subsequently adopting the necessary measures. We assist companies in designing and implementing a plan of restructuring measures in the strategic, operational and financial area. We proceed systematically to help clients stabilise the situation in the short term, thereby creating prerequisites for the preparation of medium- and long-term measures aimed at restoring the company's value.
In times of liquidity crisis, we are ready to assist management to propose, manage and implement so-called “quick wins” in releasing funds tied to working capital. We have extensive experience in optimising and managing working capital across multiple industries.
Assuming that the company knows the causes of its decline in performance or the crisis, it can react by preparing and subsequently adopting the necessary measures. If the situation allows for an out-of-court solution in the form of financial restructuring, we assist companies in designing and implementing a restructuring plan.
We help the company reach alternative refinancing options for dealing with its existing debt, and we also design and implement restructuring of the balance sheet, optimise the capital structure, and obtain new financing options (e.g. in the form of off-balance sheet financing).
Negotiating a particular restructuring solution is often challenging, due to an informational asymmetry among individual stakeholders. Their assessment of a proposed strategy may be influenced by an inaccurate perception of their security position, which could be substantially different if put to the test of formal insolvency proceedings. An EFO thus serves as a benchmark to compare the terms of a proposed out-of-court restructuring solution with alternative in-court scenarios. The process involves performing an indicative valuation of both the business and its assets, as well as determining the potential claims among which this value would be distributed.
EFO serves as a tool for determining the impact of insolvency on (i) the value of the business if sold as a going-concern or on a piecemeal basis; (ii) the dilution of the lenders’ balance sheet claims with contingent liabilities, priority claims and other off-balance sheet items that would only crystalise in insolvency proceedings; and (iii) the ranking of entitlement to claim satisfaction under applicable jurisdictions.
Complex and volatile economic environment, rapid changes on the market or new competition and technologies - all of these factors can cause financial distress. If left unaddressed they can ultimately threaten the very existence of the company. Taking into account all possible options available for a financial distress solution, a controlled insolvency process can be identified as the most appropriate under certain circumstances. At other times, insolvency may be an unplanned and unexpected event. In both cases the priority is to protect the value of the company and maximise satisfaction, which requires extensive expertise and experience with insolvency proceedings.
If you become aware that your subsidiary business, autonomous business unit facility, branch or brand is underperforming, we are able to help you recover optimal value. We work with you to identify the issues and evaluate the options available and assist in implementing the chosen approach (e.g. sell, fix and sell, or wind-down). We can also help you identify and manage the risks inherent in the process. The planned outcome will be an increase in shareholder value by selling, restructuring, closing, or winding down the underperforming business or subsidiary.
We aim to avoid the ’fire-sale’ scenario. “Fix and sell” is a preferred exit route where we combine our turnaround and disposal expertise to maximise the value of the transaction. We may even consider expanding the business by merger or acquisition if this can add to the eventual resale value.
Controlled exit - we would gradually shut down operations over an agreed upon timeframe, while finishing existing orders, selling assets and maximising the collection of receivables. Sometimes, however, the best strategy may be to terminate the company’s activities as soon as possible.
PwC supports owners facing an urgent need for cash or insolvency trustees charged with selling a debtor’s estate with the distressed sale of the entire business or select assets.
Our services in the area of NPLs are primarily focused on the evaluation of loan portfolios and the sale of such portfolios or individual loans. We advise banks and other financial institutions on the disposal of non-performing loans. Our services include conducting financial due diligence, preparing information memoranda, asset valuations and disposal options. We identify potential investors, and facilitate sales negotiations and deal completion. For portfolio investors, we offer comprehensive advice on the buying process and detailed due-diligence of the portfolio.