Deloitte and the executives of Aaronite Partners have launched Aaronite, a new chief restructuring officer business. The new venture will offer chief restructuring officer services which will complement the current offerings of the reorganisation services practice at Deloitte. Iain Lynam and Mike Grant, both experienced company doctors will own and lead the Aaronite business. No partners or employees of Deloitte hold or will hold an equity interest in the business and/or a directorship of the business.
Grant has held senior positions at Railtrack, Eurotunnel and Cable & Wireless and Lynam is currently working with the North West Health Authority and is also a director of the Society of Turnaround Professionals.
Aaronite has an exclusive marketing arrangement with Deloitte, supplying chief restructuring officers (CROs) to businesses in distress.
According to Deloitte research, the average time taken by companies to recover when the share price is in decline is 26 months. However, when a CRO has been appointed to manage the turnaround, the share price recovers on average in ten months, less than half the time otherwise taken.
The analysis is based on 71 major European restructurings including Energis, Eurotunnel, Jarvis, Marconi and Queens Moat Houses.
Gerry Loftus, partner in the reorganisation services practice at Deloitte, said: “The creation of Aaronite is timely. The research by Deloitte helps to illustrate why the role of the CRO has become much more prevalent in recent times. Lenders, companies and equity investors now expect a CRO, taking an executive role, to be appointed in restructuring situations to deliver a turnaround plan. Companies that do not react quickly pay the price.”