Gresham Considine

Situation

This case involved a UK quoted company which expanded through both acquisition and rapid development of its existing brands. Strategy included roll out of new outlets with high fit out costs but resulted in a lack of available capital to invest in a growing tail of underperforming units with costly lease obligations. Poor operational controls made effective management difficult and resulted in uncertainty regarding trading performance.

As performance deteriorated and accounting problems emerged debt covenants were under pressure and share price fell sharply.

Intervention

A stable short term financial platform was provided by the lenders to allow the company time to identify the extent of the trading and operational problems and develop a recovery plan for the business.

External advisors were engaged to review the options for addressing the underperforming tail of the business resulting in rebranding, nominal investment, and exit strategies being developed and implemented.

Immediate action was taken to improve visibility and management of cash whilst tighter operational controls were introduced across the outlets.

Management changes were instigated including the introduction of a new CEO to implement the agreed recovery plan and improve confidence of stakeholders generally.

Outcome

Finances successfully restructured to support the business recovery plan and disposal and rationalisation strategy. Achieving a stable platform from which to move forward  preserved value for both equity and senior lenders.

Nature of Support

Stakeholder Management

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Operational Restructuring

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Financial Restructuring

Case Details: £400m turnover leveraged Pub Group

Case History