When a company is experiencing a liquidity crunch, one of the keys to the success of the turnaround exercise, is having sufficient and flexible funding available. In a sense, the turnaround project is an investment, since changes in the structure of the business without exception require investments, resulting in negative cash flow.
If it has already been financially driven into such a difficult situation that external funding is required to pass through the turnaround project, it is essential to be able to demonstrate to the financiers that the direction of the company is reversible, and the firm has a hard base on which the future can be build.
Cash flow generated by different business units should also be analyzed (portfolio analysis). It will help identify problematic and/or cash flow negative units as well as business units with stable, predictable cash flow. In this case, the basis for the design of the turnaround project, and also financing, can be laid, as it is possible to simulate the impact of structural change in the cash flows.
We help you to communicate with the financiers and to find the right financing partner to get the company through the turnaround process.