Press Release
11 November 2008 | CREDIT CRUNCH “HAMPERING TURNAROUNDS” - MORE LIQUIDATIONS ON THE HORIZON.
With the UK economy moving into recession during the worst financial crisis in recent history, turnaround professionals are busier than ever and expect to be busier still in 2009 – but options to save businesses are being stifled by the credit crunch.
According to the TMA's 2008 Trend Watch poll, its members' engagements and revenue are increasing, especially in the manufacturing, construction, and distribution industries. But many respondents expressed deep concern about the issue of liquidity and the lack of availability of finance to execute turnarounds, sustain client operations, and attract potential buyers.
TMA (UK) President Tyrone Courtman, Head of Business Recovery at Nottingham-based Cooper Parry, said that although most respondents reported increasing business, all too many of the new cases they were handling were short-term liquidations rather than traditional turnarounds.
“The lending clampdown is making it more difficult for members to secure the credit necessary to restructure their clients' finances, leaving liquidation the only option for many,” said Mr Courtman.
“TMA and its members are primarily dedicated to restoring corporate value, rather than merely handling liquidations.”
“We therefore support the Business Secretary, Lord Mandelson, in his efforts to persuade the banking industry to restore the flow of vital credit to SMEs in need of recovery. Unless that happens, Britain could emerge from this recession with its business base significantly eroded.”
On a more positive note there has been an upward trend in management teams of distressed companies taking the initiative and seeking turnaround advice before being prompted by their lenders. This indicates a breach in the “wall of denial” that has often caused fatal delays in seeking professional help in the past, says TMA.
Further information:
Tyrone Courtman, President TMA (UK) 01332 295544 tyrone@cooperparry.com
David Hole, Membership Director TMA (UK) 07976 758246 davidhole@alexanderbc.com
Notes to Editors:
TMA (UK) is a multidisciplinary trade association of professionals involved in turnaround, recovery, reconstruction, refinance and change management. Uniquely, TMA (UK) membership embraces professionals from a variety of backgrounds including accountancy, law, banking, insolvency practice, and change management. TMA (UK) has 13 regions, and members network extensively at both national and regional level, building up essential contacts among different disciplines.
Issued by Kickstart PR: Ted Bruning – 0844 80 40 550 – ted@kickstartpr.com