| COURSE : CERTIFIED DISTRESSED DEBT & RESTRUCTURING PROFESSIONAL | |
|---|---|
| Course Overview | The objective behind distressed debt and restructuring is to increase recovery rates through maximizing asset values. In addition to maximizing value in a distressed situation, we will examine who are the “stake holders” and what are the priority of those claims in the “water fall” of value |
| Training Duration | Total Training Hours : 30 Hours Training Duration : 1 Week Total Training Days : 5 Working Days |
| Training Schedules | Weekdays (Sunday to Thursday) Regular Sessions : 6 Hrs Per day (9am to 2pm or 3.00pm to 9.00 pm) Food & refreshments Included WeekEnds (Friday & Saturday) Fast Track Sessions: 8 Hours per day (9am to 5pm) Food & refreshments Included |
| Certifications: | 1) Certificate from Laurels Training Institute, Attested by Knowledge & Human Development Authority (KHDA) government of Dubai, UAE OPTIONAL 2) Certificate from American Institute of Professional Studies (AIPS) from USA (After 15 Days of course Completion which will couriered to the attendees office address) |
| Tests | Yes |
| Learning Aids | Yes |
| Course Material | Hard & Soft Copies of Study Material |
| Language of Instruction | English |
| Instructor Helpline | Yes 1. Email 2. Social Media (For Emergency requirements) |
| Registration Requirements | 1. Passport Copy 2. Curriculum Vitae 3. Passport size photographs 4. Course Fee |
| Mode of Payment: | Cash / Cheque / Credit Card / Bank Transfer. |
| Eligibility Criteria (Who should attend this training) |
Bank credit officers Investment bankers Management consultants Bond credit analysts Fixed income/credit traders Fixed income/credit sales people Fund managers Treasurers Compliance officers Financial decision makers in corporations |
| Course Benefits |
The participants will then explore out-of-court and in-court restructuring, as well as the associated benefits and costs. This course will benefit any professional interested in understanding the distressed debt and restructuring process, for career switchers without prior experience, communications, marketing and client relations personnel for any distress-oriented asset manager/hedge fund as well as anyone that desires a deeper understanding of credit beyond the traditional “risk, mitigate and return” approach. |
| Course Contents / Outline |
SECTION 1 Definitions of NPLs and distressed debt Typical causes of distress – sovereign, industrial, cyclical and firm specific Introduction to financial analysis for distressed firms
SECTION 2 Common early warning signs that a firm is becoming distressed Market/economic based signs Income statement/operational signs Cashflow signs Balance sheet signs Acting on early warning signs if there is no covenant breach Should the lender give more time and/or lend more money? Should the lender foreclose?
SECTION 3 Analysing the income statement of distressed firms Understanding the sources and sustainability of revenues and earnings Can the firm generate in future sufficient earnings to service debt? What constitutes interest charges, incl charges for derivatives and quasi-debt? Adjusting for exceptionals, non-core earnings, discontinued items Calculating adjusted margins, EBITDAR and EBITDA interest cover Adjustments for operating leases, joint ventures, minority interests Analysing the scope for cost cuts to improve earnings
SECTION 4 Analysing the cashflow statement of distressed firms Identifying warning signs of cashflow shortfalls Can the firm generate sufficient cash to service interest and meet other obligations? Forecasting cash available for debt repayment and cash available for debt service Payback and debt service analysis Identifying new sources of cash for debt service Analysing the scope for improving operating cashflow and for reducing NWC and other investment spending Cashflow vs asset based lending Analysing high growth firms that over-trade and run out of cash
SECTION 5 Analysing the balance sheet of distressed firms The nature of the asset base – is the firm worth more as a going concern or liquidated? Balance sheet values versus market and liquidation values Structural subordination and double leverage Consolidation policies – are debt/costs/losses hidden in off balance sheet vehicles? What constitutes debt – including derivatives, quasi-debt and off balance sheet liabilities Adjusting for factored receivables, operating leases, contingent liabilities What other liabilities might crystalise in a default? ROIC analysis and ROIC vs WACC Liquidity analysis Analysing the scope for new equity issuance Ratio analysis – leverage, liquidity, asset coverage, working capital, ROIC, ROE, asset turnover
SECTION 6 Modelling for distressed credits in Excel Introduction to comprehensive forecasting model Forecasting assumptions for the IS, CF and BS What are the key earnings and cashflow drivers for the distressed entity? Tools and key indicators to help with forecasting for distressed firms Covenants - setting revised, cashflow-based covenants and forecasting headroom Structuring cashflow sweeps Scenario analysis – what is required for the firm to turn-around? What could trigger further performance short-falls? Use of liquidation models to assess each stakeholder’s economic interest
SECTION 7 Debt restructuring overview Guidelines from Central Banks Aims of the restructuring for lenders Does the company need additional funding? Rescue vs liquidation, now or later Other liabilities that might crystalise in an event of default What happens to collateral value during a default situation? Dealing with other banks - multi-creditor workouts Preferential claims and ranking of claims
SECTION 8 Option 1: Operational restructuring for distressed entities Should this take place before capital structure changes or at the same time? Management – does the firm need new or additional directors? Strategic analysis and new strategy How to maximise cashflow generation
SECTION 9 Options 2-4: Restructuring of loans and of the capital base Option 2 – equity injection, shareholder loan, equity cure Option 3 – amendment of financing terms - PIK, PIK toggle, cash sweeps, extended maturities, Rewards for amended financing terms - additional security, warrants, convertible loans Return analysis – equity kickers, warrants, compounded PIK returns Option 4 – debt restructuring Debt for debt swap, discounted debt buyback, full or partial debt for equity swap, lenders sell Debt at a discount, engage suppliers in restructuring, cashflow ring-fencing Why restructurings do not always work
SECTION 10 Monitoring distressed and non-performing debt Agreeing forecasts with the borrower Reporting requirements for the borrower Agreeing new Heads of Terms with the borrower Setting covenants and covenant testing Board seats and management influence" |