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Our Speciality
TMP is a multi disciplined firm specialising in business turnarounds of financially distressed businesses. We regard ourselves as being unique in that we are:
• Probably the first independent UK restructuring firm to focus on turnarounds;
• Independent.
• We can uniquely provide multi faceted solutions as we can not only advise on deals
we can also provide both turnaround finance and management expertise.
Our Structure
TMP is specifically designed to address all the requirements of the turnaround and rescue procedures of a financially distressed business. We provide professional and technical advice in structuring turnaround deals. This encompasses advising on complex areas of finance and law, implementing the turnaround deals and process, introducing new finance and enhancing this process with management skills and support.
TMP's professional team have the highest level of professional qualifications and very extensive turnaround experience. Our clients find this invaluable.
TMP Turnaround Capital
TMP Turnaround Capital is a private equity capital fund which solely provides finance and investment for the business rescues of financially distressed businesses. We commonly syndicate deals using TMP’s partners’ private funds and other private equity funds that we have worked with in the past.
TMP Turnaround Management
TMP Turnaround Management provides experienced hands-on management to implement viable and realistic rescue plans.
How We Can Help You
We act for a wide variety of interests in the turnaround of distressed businesses:
• Directors, shareholders and their advisors;
• Providers of finance who either want to exit or improve their position by enhancing their
security while at the same time improving their returns;
• Creditors.
Our unique structure allows us to:
• Advise on the most appropriate restructuring given the financial position, objectives and
realistic options;
• Obtain turnaround finance whether from our own fund - TMP Turnaround Capital - or from
third parties, and;
• Provide intensive care management with the objective of returning the distressed business
to financial and operational stability.
Definition of Turnarounds
We define turnarounds as returning an insolvent or potentially insolvent business to operational and financial stability, while maximising all shareholders' interests.
The Mechanics for a Turnaround
Although all turnarounds are different and one cannot prescribe a "format" for a turnaround, we feel that most (but not all) turnarounds require certain common ingredients.
1. Proving core viability.
2. Restructuring skills and experience.
3. Turnaround finance.
4. Turnaround management.
We feel that once the core viability is proven, that the implementation of the turnaround is a bit like a 3 legged stool. If you try to implement a turnaround without including all 3 components of turnarounds, the stool will become unbalanced and fail.
For this reason, we specialise in providing all 3 key areas:
• Professional Turnaround Services.
• Turnaround Finance.
• Turnaround Management.
Classic Turnaround Cycle
In order to demonstrate the classic turnaround cycle, we have created a series of graphs.
1 - Business in Crisis
In the above graph we see the start of the business cycle. The concept of "critical stability" is fundamental. Critical stability is the point where a company achieves both operational and financial stability. In this graph the business has grown successfully, but through "critical stability" and an event or a series of events has caused the business to be radically weakened.
2 - Action Stations
At this stage, one of 2 things happens, either creditors commence enforcement actions (to get their money back) or directors initiate action by seeking out specialist advice.
3 - Restructuring
This graph shows the impact of restructuring. By this we refer to restructuring creditors.This can involve a simple deferment of (for example) one creditor, or, it could involve a more complex insolvency restructuring. Examples of this are company voluntary arrangements (CVAs), administrations and “informal” creditor deals.
However, regardless of the procedure, our experience has shown that if one relies solely on the "restructuring", it rarely achieves a sustainable turnaround. This is because the business is not effectively stable. So while cosmetically balance sheets can radically improve, this in itself can often be insufficient.
4 - Turnaround Finance
It is commonly essential to insert either replacement or additional finance.
This is because turnarounds have a very high propensity to absorb funds at a greater rate than going concern restructurings.TMP are recognised leading experts in this field. We have been active for many years in promoting TurnaroundFinance.com. This explains the following:
1. The principles of turnaround finance and the types of deals and finance commonly available.
This includes a fully downloadable guideline which was co-authored by Douglas MacDonald for the Corporate Finance Faculty of the Institute of Chartered Accountants in England and Wales.
2. A database of providers of specialist turnaround finance.
3. A database of specialist turnaround finance advisors who can advise on structuring and
obtaining turnaround finance.
In addition, TMP’s partners invest in deals that suit our investment criteria.
5 - Turnaround Management
In virtually all cases (in our experience the financial crisis are a result of management errors. The degree of error may be minor or fundamental, and the need for turnaround management may vary. We do not belong to the school of thought that says that all management of all financially distressed businesses should be replaced.
However, we believe that
1. It is unlikely that all of the existing management, which causes the financial crisis,
are the appropriate people to initiate the turnaround, and
2. Almost all management teams in distressed businesses have weak areas that must
be addressed if the turnaround is to be effective.
Therefore, we believe that in almost all turnarounds, dedicated turnaround management support is required.
6 – Changing the Game Plan
Our experience has been that not only do you need to focus on changing some or all of the people and for the focus of the management team – but we need to focus on changing the game plan.
We normally use a “bridge” statement which bridges the required steps from a current loss making to an operating profit. This change has to be possible to be effected in a short time – as little as 3 to 6 months.The bridge includes key (and perhaps obvious) steps like redundancies and lease terminations.
However, we have been more aggressive than this traditional model, by moving some or all of the business offshore to a low cost developing market economy. Please see our offshoring section.
7 - Value Added
This graph shows the complete turnaround process. There are a number of observations.
1. The process usually takes between 6 and 12 months. However, this period may be much
shorter or longer given the nature of the crisis.
2. The restructuring and finance legs are essentially concerned with strengthening the
businesses' balance sheet, whereas the turnaround management process is about improving
operational stability to generate sustainable profitability and cash generation.
3. The value of the turnaround process is taking the business value from zero - which would
be the case in terminal insolvency, to a going concern value. This is the added value that TMP
are experts at providing.
Business in Crisis
Action Stations
We were voted
"Leading Independent Turnaround Firm in
the UK"
Inside Guide
TMP UK
Level 25 Tower 42
25 Old Broad Street
London EC2N 1HQ
United Kingdom
T: +44 (0)20 7496 1010
F: +44 (0)20 7374 8341
TMP SA
Ruskin House
Roeland Street
Cape Town 8001
South Africa
T: +27 21 461 2647
F: +27 (21) 461 2642
Map Link