Successful Company Voluntary Arrangements (CVA’s) – Yes they do exist – please read on!
In May 2008 we were approached by the owner/operator of 2 health and fitness clubs. He was faced with an extremely challenging situation as one of the clubs was loss making and this had completely eroded the capital base of the company – a balance sheet ‘black hole’ had opened up and it was growing rapidly.
In May 2008 we were approached by the owner/operator of 2 health and fitness clubs. He was faced with an extremely challenging situation as one of the clubs was loss making and this had completely eroded the capital base of the company – a balance sheet ‘black hole’ had opened up and it was growing rapidly.
However, there were some significant positives:
- Directors had formulated a new ‘budget’ club model that looked viable.
- The underperforming club could be ‘wound down’ with the support of the landlord.
- Local development/re-generation was starting to show signs of tangible benefits to the better performing club.
The most precious commodities in these situations are often some time to review the options and a strategy to relieve cash flow pressure. We worked closely with the owner and other stakeholders to ensure that any immediate threats to the business were dealt with and this facilitated the time to formulate a workable CVA proposal.
The following testimonial is from the owner.
“I was faced with an almost impossible financial situation when I was introduced to Beer & Young. However, with their help and guidance we put a business recovery plan (CVA) in place that has put my club back on a firm financial base.
This gave us the opportunity and time to re-position the business and I am delighted to say we are now profitable once again.”
No comments:
Post a Comment