I was hoping someone involved in restructuring/bankruptcy could shed some light on the responsibilities of these two groups in the bankruptcy process? Financial adviser meaning, say Houlihan, and legal being the law firm. And then where do the consultants like Alvarez and AlixPartners come into play? Are they solely operational consulting?
My basic understanding is that the banks are responsible for securing the new financing, turnaround consultants implementing cost-cutting measures, and lawyers drafting all of the legal docs and writing the plan of reorg.
I want to get into the industry and not sure which route to take, so trying to evaluate both. I work in a valuation group now so already posses some of the modeling skills.
Depends on the transaction. Consultants tend to do less ( European RXing generally will involve an Independent Business Review / Report ("IBR") which is normally more of a formality than a document upon which reliance is placed, normally from the big 4. Turnaround consults less frequently utilised). And depending on the firms / transaction lawyers and bankers merge / overlap on responsibilities, to an extent.
But your assertion on bank financing is incomplete and a small proportion of a banks' responsibilities. With the primary being negation and formation of proposals, coordinating with lawyers as to the extent, limitations and ability to implement these proposals.
And remember, advisers are just that, they don't make the decisions. At the end of the day if the lenders don't want to take the hair cut, or management don't want to give up their plush offices, there's nothing the advisers can do. (unless in the example of consultants put in as management / CRO)
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