Project Example 30

Project Example – Financial Restructuring

Assignment Preparing a corporate level strategy to restructure the debt and assets of an investment company (balance sheet restructuring)
Client Name Kuwaiti investment company
Client’s Activities Leasing, finance and investment
Project Size
  • Debt obligations size for restructuring: ~USD 125 million (contractual debt) and ~USD 50 million (other obligations)
  • Assets size for restructuring: ~USD 265 million (mostly real estate investment properties)
Assignment Date & Duration 2012, 3 months
Main Area of Focus Restructure company’s indebtedness (local debts) and investments with the aim of primarily: i) restructuring paying-out its defaulted financial obligations in full, ii) restructuring its assets-base, and iii) avoiding liquidation (or bankruptcy). The objective is to keep the company operating on an ongoing basis and restoring its profitability with an ultimate goal of protecting shareholders’ wealth.
Services Provided
  • Review, analyze and assess the company’s financial position and assess its liquidity base and solvency position.
  • Identify and assist in determining the fair value of the assets to be used in the debt restructuring plan and especially those to be collateralized.
  • Review the existing strategy and assist in developing a realistic strategic plan to serve the company’s goals and guide it in its corporate debt restructuring plan.
    o Assist in setting strategies to ensure the settlement and closing of debt claims from all creditors and other related parties claims while preserving and protecting shareholders wealth.
    o Assess and propose a debt restructuring plan and prepare debt restructuring schedules accordingly.
    o Assess and estimate future cash flows under the context of a corporate debt restructuring plan.
  • Propose an out-of-court Corporate Debt Restructuring (CDR) plan with alternative scenarios to be presented to creditors.
  • Assist the client in negotiations with creditors, especially the most senior creditors (in terms of size of outstanding debt and collateral) in order to reach an understanding on a CDR plan scenario acceptable to all stakeholders prior to resorting to protection under Kuwait’s Financial Stability Law (“FSL”) No. 2 of 2009.
Outcome The company received approval to enter under FSL Law based on the CDR plan developed by AlShall