Eddie Griffith RTE® | ReGroup Solutions | Originally Published 10 September 2020
This article is about a recent safe harbour success. At ReGroup Solutions, we absolutely love getting a great outcome for clients. What makes this particular case different is that we were able to use the safe harbour provisions under section 588GA for the precise purpose for which the legislation was intended.
The director engaged multiple advisers, all tasked with assisting in specific areas, and whose advice collectively helped him navigate his business back from the depths of insolvency and towards a golden business succession strategy. This truly is a safe harbour success story.
ReGroup Solutions would like to thank Ian Haggerty of Benchmark for achieving an amazing outcome for his client – we sincerely appreciated the opportunity to collaborate with you in getting such a great result. Thank you also for your kind testimonial Ian, we look forward to working together with you on future projects.
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I would like to share an uplifting experience with Turnaround Practitioners ReGroup Solutions who helped managed one of my clients through the initial COVID downturn. Australian businesses need to be aware of the services these experts provide and the great outcome they can get for struggling business owners! Well done to Ben Heaney, Michael Durbridge and especially Eddie Griffith (who had day to day management of the case).
In brief, I had a business sale listing for a substantial construction business. Whilst the business had value, the director risked trading insolvent due to delays on project work. My client was obviously concerned about servicing the bank debt and stood to lose his family home. The director had sought the advice of a registered liquidator – who recommended an administration and a DOCA or placing the company into liquidation. Neither has good prospects on paper – then the COVID crisis struck…
I urged the director to immediately seek a second opinion and referred him to ReGroup Solutions (having seen some of their work previously). Within just a few days, the ReGroup team had undertaken a preliminary review and identified the multiple complexities faced by the director and the business. After understanding the key objectives, ReGroup had developed a strategy which included detailed scenario and financial analyses.
Continued trading under the protection of the Insolvency Safe Harbour was compared to that of appointing the registered liquidator – this demonstrated throughout the process that a ‘better outcome’ could be achieved for stakeholders if the director remained in control. I was astonished at the level of detail included in the practical considerations and financial consequences. Throughout the course of the engagement the Director’s predicament changed and various hurdles presented themselves. ReGroup’s ongoing strategic thinking aligned with their originally agreed objectives and complex issues were dealt with in a timely manner as they arose.
The bottom line? Collaborating with ReGroup, we assisted the Director with negotiations with interested parties and eventually struck a deal for the sale of the business and assets to an independent third party. Not only did we save 2/3 of employees jobs, the bank were satisfied and the trade creditors stand to receive all of their debt!
Importantly for me, the Client ended up well over $2 million better off through ReGroup’s advice in utilising Safe Harbour Protection and I’m delighted he will now retain his family home despite the unexpected COVID crisis.
Ian Haggerty, Benchmark Corporate
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Media coverage of the story can be found here – “Family Business Rescue – McMahon buys Asurco & preserves future of SA construction.”
Should you or your client face financial distress or insolvency, please get in touch with the ReGroup Solutions leadership team.
Article reposted – Eddie Griffith RTE® | Ben Heaney RTE® | Michael Durbridge RTE®