HomeCase studiesBanks & financial institutionsClient take-onEnsuring a solvent business restructure for the next generation

Why the client needed our help

Our client was providing commercial finance to a recruitment agency. The shareholder and director of the agency was planning his retirement. As a first step, he wanted to divide the existing business in two, selling one part to his son and retaining the other part in a second entity.

Both new businesses wished to use our client’s receivables finance facilities. At the same time our client wanted to transfer the legacy facility to its own new entity, which would also provide funding to the new businesses.

We were asked to assist in structuring the transaction to ensure there was a smooth transition of business for both the two new companies and our client.

How we helped

After reviewing the terms of the share sale agreement, and the business and assets sale agreements for the recruitment agencies, we advised on and prepared the documentation that would effectively transfer the book debts of each part of the business to the new companies, also ensuring that these debts could be used by the new companies for receivables financing with our client.

We reviewed and approved all the corporate approvals and formalities for each of the companies for both the share and business transfers and the multiple secured finance facilities. We worked closely with the companies’ solicitors, co-ordinating and supervising the simultaneous completion of all agreements. We also assisted our client by preparing a complex security structure, involving cross-corporate guarantees supported by all asset debentures from all the recruitment companies, in favour of our client and novating the original facility to the new funding entity.

The outcome

Our carefully constructed financing structure and oversight of the restructuring meant that the business separation and sale to new trading entities could be completed without any interruption to the recruitment agency business. It also meant that new secured receivables financing facilities could be implemented immediately on terms acceptable to our client.

I have had a decade long relationship with FWJ and have instructed them on a wide variety of claims, both litigation and insolvency based. I enjoy working with them as they listen to what I need and their advice is always commercial and astute. I have also been deeply impressed by their continued commitment to using technology to assist in the recoveries process. Their interactive case management system is particularly impressive delivering quick, accurate solutions together with very helpful case reporting.

Risk director at Aldermore Bank

Case studies

View all case studies

Contact us in confidence