Secured refinancing via creditor-backed restructuring plan
Case study:
Secured refinancing via creditor-backed restructuring plan
- Situation
- A global retail group scaled rapidly through M&A and funded growth with heavy investments in infrastructure and assortment
- The market dropped abruptly and exposed high operating leverage and weak working capital discipline with inventory trapping cash
- With liquidity at risk, the group needed a creditor-backed path to profitability and committed funding to bridge the turnaround
- Actions
- Executed immediate cash conservation measures, including supplier negotiations, order cancellations, inventory clearance and discretionary spend cuts
- Built turnaround plans for each business unit with sequenced levers, then prioritized units by liquidity impact and recovery potential
- Earmarked non-core business units for sale and started the sales process to generate cash
- Cut the IT roadmap to turnaround-critical measures and froze non-essential programs to conserve cash
- Restructured the group holding organization to match the reduced footprint and the new operating reality
- Set weekly reviews with named owners and KPI tracking to build creditor confidence and drive implementation
- Results
- Advisory board approved the revised strategy and divestment and closure package, and creditors endorsed the plan, securing group refinancing
- Started executing turnaround plans per business unit, putting the group on a path to a smaller, profitable, cash-generating business
- Maintained delivery discipline through weekly KPI tracking and course corrections