Thoughts on Restructuring Groups?
I was wondering if anyone here had experience with or knows anyone that works at a big 4 restructuring group? I know A&M, Alix, and FTI are top for restructuring (consulting), but how are the big4 viewed in regards to restructuring? is the work any different? ops? etc.
Referring specifically to the US
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Sure, I'll bite.
So, Big 4 rarely touch Investment Banking's version of restructuring (e.g. Chap 11 and debt restructuring). Big 4 touches on the Company restructuring. Specifically, operational restructuring.
Basically, Big 4 fall into these buckets;
Operational restructuring aka FTE management (e.g. firing/hiring), process efficiencies (e.g. controls/checks to improve ability to pay, debt coverage, etc.) Business turnarounds: Strategy (but this is really MBB type work. Big 4 hardly gets a seat at the table here) Bankruptcy assistance: Essentially project management Supply Risk Management: Vendor project management
If you're looking for financial restructuring and securities work, Big 4 is not best execution.
RX consultant here (at one of the market leaders, non-Big 4). Completely disagree with the above. My take on the industry is following: - MBB - they do not have a big presence in actual financial restructuring or real CRO work. McK RTS or BCG Turn rather deliver big transformation programmes and not any meaningful debtor or creditor advisory to distressed companies. - Big 4 rather focuses on financial restructuring. The typical work delivered here would be:
1) Independent business reviews (restructuring due diligence) and debt/cap structure negotiations and advisory. This would be relatively similar to what banks do however Big 4 work typically for mid-market firms and often for creditors. 2) Support in chapter 11 and insolvency proceduresa and Cash Flow/liquidity monitoring 4) Working Cap Advisory - some of the Big 4 in certain markets have dedicated teams to WC improvement within Restructuring, which offers a good mix between financial and ops work. 5) Big 4 also deliver Ops Restructuring work, often to mid-caps however this share of work is far smaller. Bigger operational transformation programmes (so rather performance improvement than advising distressed companies) are rather done by the consulting/advisory arms not Transactions (where restructuring sits). And they actually DO get a a table at large transformations, especially when it comes down to long-term execution programmes.
And there is A&M, Alix and FTI who deliver both financial and ops work and I would consider them market leaders in RX consulting.
Aside from Alix, AM, FTI, are there any other noteworthy restructuring firms?
I work at one of the big 4. We have a specific turnaround advisory team (that I sit in) that does operational restructuring. Note that this is very different work from fornal insolvency engagements such as bankruptcy and IAs. Projects i have worked on include a profit improvement program in FMCG, an executive workshop for a Mining giant, and a half-billion dollar cost out program for Government. We compete directly against McKinsey and BCG in this space, along with other boutique firms. A number of partners/directors at my firm are ex-McKinsey and there are great opportunities to work closely with them and tap into their knowledge. Teams run pretty lean so for Analysts you get quite a bit of responsibility early which aids development.
Happy to elaborate further if theres any interest. Cheers.
Do you mind briefly describing, for those of us not in the know, what a project would look like on a day-to-day basis, or maybe what the overall objective of, for example, a "Profit improvement program in FMCG" project would be?
I've read a lot of different things about restructuring and still get a bit confused about the difference between the banking and consulting sides. It'd be great to have someone in the consulting restructuring industry give us their take.
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