Happy holidays – Looking Back at 2013 & Forward to 2014
Corporate Restructuring Group – December 2013 newsletter
The Deloitte CRG Newsletter addresses the current state and outlook for the CRG practice, including recent engagements, announcements, case studies and upcoming events.
Happy holidays 2013
It seems like the holidays come up earlier and faster each year. Often we look up from our busy lives and wonder, where did the year go?
"It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity...." The first line of Dickens's classic A Tale of Two Cities would seem a very apt description of 2013, a year in which it has been hard to tell if the economy is recovering or still struggling in which there seemed to be two different capital markets, one where credit was plentiful and cheap for larger borrowers another where smaller companies were starved for liquidity to the point of oblivion. In the former, loans with little or no covenants are being issued by companies at record-low interest rates; in the latter, credit is simply not available due to tightened standards and the continuing uncertainty over whether general economic conditions will continue to improve. While we continue to be very busy, in our practice the number of new assignments involving companies with more than $500 million in revenues has fallen by two-thirds compared to last year. Meanwhile, 95% of our new assignments in 2013 involved middle-market companies under $500 million in revenue.
Whatever 2014 may bring, be our clients large or small, in deep distress or simply not realizing their full potential, Deloitte CRG continues to offer the breadth and depth of talent to meet any need, from complex operating and financial restructuring to targeted performance improvement. In the meantime, we pause to acknowledge that we would not be where we are without those who have supported us and our practice. Deloitte CRG wishes our valued friends and colleagues – and all those close to you – a peaceful and joyous holiday season a new year filled with health, prosperity and achievement.
Marking time: The problem of excess cash
In this economy, excess cash isn't always a bad problem to have – however, keeping it on the books isn't always the answer. When excess cash sits on the balance sheet, it's not being utilized for initiatives that further innovation or growth. While cash distribution may temporarily satisfy impatient shareholders, returning cash won’t be enough to meet long-term expectations for growth sectors such as technology and life sciences.
Companies that apply a comprehensive approach to cash deployment and focus on long-term value creation will be more likely to satisfy both the market and their shareholders.
Wealth planning in a time of uncertainty may feel as solitary as standing on a mountain ridge at sunrise, camera in hand, waiting for ideal conditions to capture that once-in-a-lifetime shot. But there are tools that can help. The 2014 Essential Tax and Wealth Planning Guide discusses available opportunities that could fundamentally change how individual taxpayers compute their taxes.
Deloitte CRG’s featured engagements this month include work with the following selection of clients: oil field services, recycled paper manufacturer and a telecommunications company. For an in-depth look at Deloitte CRG’s recent engagements, check out featured engagements.
As used in this document, 'Deloitte' means Deloitte LLP [and its subsidiaries]. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.