A turnaround is a general term to describe the process of restoring a company in distress to financial strength. A turnaround may take many months to achieve and involve substantial restructuring of a business with parts being sold or closed and will require difficult negotiations with creditors and investors.
Why turnaround is the preferred option
The main goal of a turnaround will be to avoid formal insolvency proceedings, as these will usually result in higher costs and lower returns to creditors. Turnaround professionals will be familiar with formal insolvency processes and whether an informal restructuring process can offer a better outcome for stakeholders.
