IBR and FA role in relation to UK travel agency group
On behalf of the Revolving Credit Facility (RCF) and unitranche lenders, we undertook an independent business review and advised the lenders in relation to a private equity-owned travel group.
Due to lockdown, the group suffered a severe shortfall in booking and revenue, leading to a liquidity crisis. The group presented lenders with an urgent proposal for a new money funding, rescheduling of existing debt repayments and adjustments to cash pay interest servicing.
We reviewed the group’s short-term cash flow forecast, medium-term business recovery plan and financial forecasts, as well as assessing the options for the lenders.
Our review of the business plan and forecasts included consideration of revenue and booking recovery, refunding of customers for bookings disrupted by coronavirus cancellations and postponements, as well as the group’s cost savings and liquidity enhancement initiatives.
In addition, we performed sensitivity analysis against the various scenarios for revenue recovery trajectories and the deliverability of management’s self-help measures.
Our advice and support for the lenders enabled them to consider credit implications of the group’s proposal appropriately and provide support for the group through the disruption to trading.
How we help our clients
We have been advising management teams on how to identify and implement the most-appropriate solvent restructuring or insolvency option to enable the business model transition and maximise stakeholder outcomes.
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