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Restructuring with financial and operational performance improvement for a flex-office space provider​

Key metrics:
  • Re-negotiated leases, reduced headcount, and re-capitalized the business with $500M in equity​
  • Renegotiated very favorable terms with the secured lender ​​
Value levers pulled:
  • Interim CFO services​
  • Performance improvement​
  • Restructuring advisory

Picture this...

You’re an operator of premium-hosted meetings, co-working, and flex office locations—as well as technology-enabled solutions—in class A office buildings across major U.S. and U.K. cities. In addition to your physical locations, you have developed a studio and virtual platform to allow customers to conduct global meetings in-person, virtually, or hybrid. You also help landlord partners in certain locations by managing office building amenities and tenants who have access to your services in the leased locations. On top of all this, you offer full culinary and catering services in your locations with trained chefs. Unfortunately, operations are severely impacted by COVID-19, leading to reduced revenues by more than 75%. Occupancy costs for most of your locations are based on fixed rental payments, which are no longer feasible given the reductions in revenue. Negative cash flow from operations creates a liquidity crisis with existing private equity investors who are reluctant to provide additional funding. You need to turn things around.​

You turn to Accordion.

We step in as interim CFO to help stabilize the finances and lead restructuring operations. To accomplish this, we:​

  • Curtail and streamline operations, including re-working labor models and reducing headcount by 50%.​
  • Exit certain marginal locations and re-negotiate landlord lease terms including abatements, deferrals, and modifications to terms including revenue sharing and converting leases into Managed Services Agreements.​
  • Build out the hybrid technology platform.​
  • Develop a management incentive plan.​
  • Re-capitalize the business with Ares and Hudson Bay Company, with approximately $500M in equity and debt financing, while negotiating a significant discount with the secured lender.​

Your value is enhanced.

Your performance improves following the renegotiated leases and secured lender terms, along with the $500M in equity. But we don’t stop there. We also strategically plan to grow the business, including long-term forecasts and models. We develop KPIs and reporting packages tailored to the new ownership constituents and manage M&A to assist with implementing purchase accounting, lease accounting, and improved policies, procedures, and systems to support future growth.​

Enhanced value:

You reap multiple benefits, including:

  • Re-negotiated leases, reduced headcount, and re-capitalized the business with $500M in equity​
  • Renegotiated very favorable terms with the secured lender ​​​