GEMS uses an array of tools to repair and reposition underperforming investments
Underperforming companies often require new leadership. Transitioning “C” level executives takes time and experience—time to thoroughly search for and screen candidates, and the experience to negotiate new employment contracts and incentive plans. Turning the company reigns over to a new executive requires proper planning and precise execution.
Repairing Customer and Supplier Relationships
Troubled businesses have likely strained their relationships with customers and suppliers alike. Reconnecting with these stakeholders with clear, frequent and transparent communication is required to reestablish confidence. Customer engagement in particular can reveal areas where remedial action is required and where future opportunities exist.
Struggling companies often produce irrelevant data in great abundance. Recovery starts by establishing the correct key performance indicators and dashboard metrics. These analytics can then be used to drive operating leverage and asset utilization. They may also lead to conclusions and actions regarding staff and plant rationalization.
Addressing Capital Issues
Underperforming companies have often strained their relationships with lenders and other stakeholders. Covenant breaches may require waivers and resets, or perhaps even putting a new lending relationship in place altogether. Open communication and routine updates with lenders and other stakeholders is essential. GEMS’ executives have navigated this path many times.
Affiliated units within Gordian Group offer a comprehensive suite of investment banking services including financial advisory, financial restructuring, M&A, structured finance, capital raising, litigation support and expert opinion.
Positioning for Exit
The development of an exit strategy begins with an assessment of what “barriers to exit” exist presently that are likely to have an adverse effect on a sale process. Solutions to these obstacles then need to be prioritized in terms of resource requirements (especially time) and potential impact. Known acquirers can be a key resource in helping best position the company for exit. Depending on the specific circumstances GEMS can lead the company through either a full auction or preemptive sale process, and is deeply experienced in negotiating all sale-related documentation from a business perspective.