Introduction
Just because a company needs restructuring -- financial or operational -- does not mean it will do so. An erosion of Stakeholder value may occur for a variety of reasons, including Management interference. This program shows you how to do things right.
Corporate restructuring is defined as any fundamental change in a company's business or financial structure, designed to increase the company's value. Corporate restructuring is often divided into two parts; either 1) Financial restructuring or 2) Operational restructuring. This seminar emphasizes the practical side of corporate restructuring in today’s ever-challenging world. It focuses on the two objectives of the practical application through case studies, examples and Excel® models as well as discussions of alternatives.Main ideas explored include:
-
What is restructuring & what are the alternatives
-
When & why should you restructure vs. not
-
How to calculate the “real” value of a firm both before & after a restructuring
-
What is Leverage; when to use it and how best to finance it
-
When to divest an operating unit & how to do it to optimize the remaining value
Objectives
On completion of this module delegates will be able to:
-
Fully understand the various form of restructuring
-
Discuss the real difference between Corporate & Financial restructuring
-
Know when to acquire vs. divest an operating unit
-
How to value an entity or an entire firm
-
Know when to Leverage vs. Deleverage
-
Learn to use a range of Excel models (provided)
Training Methodology
The training comprises teaching sessions covering each topic area with the theory blended with practical application. Additionally, real world examples & case studies will be used so that the Delegates will be able to apply these techniques immediately. Delegates then use the provided Excel® templates to apply their new knowledge case studies to reinforce the concepts.
Organizational Impact
The organization will benefit by:
-
Having Experts in-house to develop advanced decision support models
-
Higher productivity of personnel involved in restructuring analysis
-
Improved performance of corporate & financial restructuring methods
-
Better ways to plan & measure results of decisions
-
Realizing better options when facing divestiture choices
-
Better integration between functional areas leading to better decisions
Personal Impact
The delegate will benefit by:
-
Developing an improved understanding of the risks & benefits of corporate & financial restructuring in today’s challenging world.
-
Really understanding the risks & rewards of leverage
-
Being able to calculate the value of the firm in the real world
-
Understanding to cost/benefit of a divesture
-
Enhancing their knowledge with the use of the models in the case studies
-
Significantly increasing their Excel® analysis skills
SEMINAR OUTLINE
Introduction to Restructuring
-
Introduction to restructuring
-
The Restructuring Framework
-
Proactive – planning the restructure before it is needed
-
Defensive - planning the restructure because it is needed
-
Distress - planning the restructure when the is no choice
-
Restructuring parties
-
Creditors – what do they expect
-
Shareholders– what do they hope for
-
Employees– what do they wish for
-
Case study
-
Excel model for decision
The Why & How of Restructuring
-
The Why & How of it
-
Why companies really restructure
-
How do companies successfully restructure in today’s world
-
When is the right time to restructure
-
The coordination and implementation of it all
-
The checklist for success
-
The “as is” value - what is the firm worth today
-
What is the product/service mix to decide what to keep and what to divest
-
Strategic partner or merger – the difference brings what value
-
Leverage – yes or no; pros & cons
-
Example
-
Case study
-
Excel model for decision
Valuation in Restructuring
-
Valuation
-
Which approach to use to be most accurate
-
Liquidation value
-
Fire sale
-
Orderly
-
Asset-based methods
-
Comparables – market driven
-
Free cash flows
-
Free cash flow to the firm
-
Free cash flow to equity
-
Option-based
-
Case study
-
Excel model for decision
Leverage
-
Leveraging and deleveraging
-
Leverage – yes or no; pros & cons
-
Establishing required rates of return
-
Adjusting the costs of debt and equity for leverage
-
Leverage optimization through capital structure (Example)
-
Bond buybacks (Example)
-
Leveraged Buy Out (LBO)
-
Going private – the costs vs. the benefits
-
The rationale for high leverage
-
Calculating your capacity for debt]
-
Case study
-
Excel model for decision
Divestitures
-
Divestitures
-
Why divest a business unit
-
The rationale for divestiture vs. alternatives
-
Divestiture vs. a spin off
-
Equity carve-outs
-
Voluntary liquidations
-
Case study
-
Excel model for decision
-
Summary and Conclusion