In the business world, not every company grows continuously. Economic fluctuations, currency risks, excessive debt, and operational missteps can push companies into financial distress. Restructuring professionals in Turkey step in precisely at this point to provide strategic guidance and help companies navigate crises.
What Is a Restructuring Professional?
A restructuring professional is a specialist who supports companies experiencing financial or operational crises by helping them rebuild sustainability and profitability. Their core responsibilities include:
- Conducting financial analysis
- Planning debt restructuring strategies
- Managing liquidity and cash flow
- Negotiating with creditors and investors
- Proposing strategic alternatives
These professionals typically operate through independent consulting firms, audit companies, or law offices.
What Do They Do?
A restructuring advisor may carry out the following:
- Debt Restructuring: Renegotiating payment terms with creditors
- Cash Flow Management: Implementing urgent liquidity solutions
- Operational Turnaround: Streamlining processes and reducing costs
- Strategic Alternatives: Evaluating sale, merger, or bankruptcy options
- Legal Process Guidance: Consultancy in bankruptcy or insolvency proceedings (bankruptcy postponement has been abolished)
Global Outlook on Restructuring
Since the 2008 global financial crisis, restructuring has become a specialized field in the U.S. and Europe. Leading international firms include:
- AlixPartners
- FTI Consulting
- Houlihan Lokey
- PJT Partners
- Kirkland & Ellis (for legal restructuring)
Why Has Demand Increased in Turkey?
The demand for restructuring professionals in Turkey has grown significantly due to:
- Currency volatility
- Persistently high interest rates
- Post-pandemic recovery challenges
- Financial management deficiencies in SMEs
- Increased foreign-currency debt burden
Consulting firms, law offices, and independent turnaround professionals actively serve in this domain.
Benefits of Restructuring Services
- A strategic roadmap out of financial distress
- Restored financial balance and liquidity
- Transparent and trust-based creditor relations
- Preservation of company value
- Long-term operational sustainability
Workout and Senior Lenders: Core Players in Restructuring
During economic downturns, lenders play a critical role in corporate restructuring processes. The two most prominent types are:
- Senior Lenders
- Workout Lenders
What Is a Senior Lender?
A senior lender holds a top-priority claim in a company’s debt structure. These are typically banks, and their loans are secured by collateral such as mortgages or pledges.
Key characteristics:
- First in line for repayment in liquidation
- Offers lower-interest loans due to reduced risk
- Engages in long-term monitoring and corporate relationships
- Commonly serves as the primary financier for large enterprises in Turkey
What Is a Workout Lender?
A workout lender is a financial institution that manages distressed or non-performing loans, either by restructuring the terms or providing new tailored facilities.
Their responsibilities include:
- Revising loan terms and repayment conditions
- Creating new payment plans
- Providing temporary liquidity to aid recovery
- In some cases, acquiring company assets to recover funds
In Turkey, this role is often handled by banks’ internal “Risk Management” or “Non-Performing Loans” (NPL) departments. Asset management companies also operate in this space.
Restructuring Practices in Turkey
- Banks typically act as senior lenders
- The Banking Regulation and Supervision Agency (BDDK) and the Banks Association of Turkey (TBB) coordinate restructuring under a “Framework Agreement”
- Asset Management Companies (AMCs) take over troubled loans and act as workout lenders
- In concordat proceedings, banks are often the main secured creditors
Why Are They Critical?
For Companies:
- Bankruptcy can be avoided
- Cash flow is restructured
- Attractiveness to new investors increases
- Corporate reputation is preserved
For the Financial System:
- Non-performing loans (NPLs) are managed more effectively
- The banking sector stabilizes
- Collection and restructuring practices become more professional
General Assessment on Restructuring Professionals in Turkey
Restructuring professionals in Turkey enable companies to continue their operations without resorting to insolvency during times of financial distress. Their collaboration with creditors facilitates not only the restructuring of existing liabilities but also the strategic repositioning of the business itself.
If you seek professional support to manage your restructuring process effectively, please do not hesitate to contact our team.
