Transaction Advisory & Restructuring
Regardless of where a retail energy company may be in the deal cycle — from pre-announcement planning to post-merger integration — FTI Consulting professionals, whether representing buyers, sellers or lenders, offer comprehensive due diligence advice and hands-on support in evaluating opportunities across the risk/return spectrum. As part of a global consulting firm known for success in high profile, high-stakes transactions, we help our clients maximise value and minimise risk.
Our Service Offerings
Restructuring and Refinancing Lead Advisory
Whether a client’s transaction is a restructuring or refinancing of its existing debt obligations, it requires someone at the centre of the deal, making it happen. FTI Consulting professionals have functioned as lead adviser in countless energy retail restructuring and refinancing transactions. We start at the very beginning in terms of articulating the transaction rationale and developing the process and timetable, and then leading that process through all phases. Typically, the process has two core stages — a financial due diligence stage, in which identifying and sharing all relevant financial information is identified; and a lead advisory stage, in which we coordinate the client’s efforts to liaise with the shareholders, financing parties (existing and incoming), their lawyers, and their stakeholders. Our goals as lead adviser are ensuring that the process runs smoothly, that the process unfolds on the established timetable, and to extract maximum value for our client.
Financial Due Diligence
Retail energy companies face transaction opportunities and challenges across the entire risk/return spectrum. Most are inexperienced and ill equipped to understand or manage the demands of these opportunities or transactions. FTI Consulting professionals are well-placed to lead our clients — buyers, sellers and lenders — through an entire transaction life cycle, offering comprehensive financial due diligence advice and hands-on support, including — quality of earnings analysis, underlying working capital and net debt profile, forecast sensitivity analysis, and Sale & Purchase Agreement advice to name a few. The result is that our clients complete transactions that are sound and sustainable.
Contingency Planning & Insolvency
The ultimate goal of contingency planning for a company in financial distress is value preservation. A well-conceived plan will help a company minimise adverse impacts on its business; will help the company act quickly to attempt to avoid creditors unilaterally derailing a turnaround plan; and will help company management and directors identify viable plans to avoid insolvency (a credible “Plan B” may be necessary in order to persuade stakeholders to support a “Plan A”). FTI Consulting has a large Insolvency and Failing Businesses Practice and has the resources to provide any retail energy company in any kind of financial distress with a comprehensive contingency plan for recovery.
A merger, acquisition, divestiture or major restructuring will have a significant impact on a company’s stakeholder communications. FTI Consulting Strategic Communications professionals are widely experienced and well versed in stakeholder management. Since it is imperative to the success of the transaction to have open channels of communications with stakeholders, we help our clients keep them fully informed, we develop key messages, we also listen to fully understand stakeholders’ positions and concerns, and we bring stakeholders together when necessary to talk to each other. We also act as a conduit for negotiations, we deliver hard messages, and, quite often, we help those who are inexperienced in mergers, acquisitions, divestitures or major restructurings (CEOs, CFOs and various stakeholders) to better understand the processes and nuances that can affect the transaction outcome.
Crisis stabilisation tends to come into play shortly after a company begins to have liquidity and cash flow problems. Many companies have not experienced this challenge and those that have could probably have handled it more effectively. FTI Consulting has professionals who know how to create a stable environment by starting to manage cash flow and working capital, and negotiating waivers and ‘standstills’ to avoid rushes to recover assets. If the crisis is more serious — facility closures, redundancies, etc. — our crisis stabilisation professionals help clients prepare to communicate with employees, local and regional and national politicians and regulators, the public and the media about what the company is doing, why it is doing it and what effect it will have on restoring the company’s health and stability.
Vendor assistance is essentially M&A support for the seller in the sale of a project or asset. FTI Consulting professionals are well versed in providing vendor assistance services to clients, including helping vendors with presenting consistent and comparable financial information, highlighting key trading trends, assisting with quality of earnings analysis, and challenging forecast assumptions to ensure robustness, before providing such information to potential buyers.