Corporate finance: Struggling corporates should face their troubles
Time won’t solve problems; Transparency is paramount
"If you are trying to simply push the ball away you are dead. You must recognize your problems. There is no situation that time alone will solve"
Jacques Gounon, Eurotunnel
Given the dire projections of corporate distress due over the next few years, companies poised to attempt restructuring would do well to listen to those that have gone before. Restructuring is always difficult and painful but it is hard to find a company that has gone through a tougher restructuring than Channel Tunnel rail operator Eurotunnel. Speaking to Euromoney last month, chairman and chief executive Jacques Gounon had some sage words of advice for the many firms that are holding out in the hope that the credit markets will improve sufficiently to provide further capital injections. "If you are waiting to see if the situation improves remember that the point at which that will happen doesn’t exist," he warned. "If you are trying to simply push the ball away you are dead. You must recognize your problems. There is no situation that time alone will solve."
Gounon was in ebullient mood, celebrating 15 years of Eurotunnel’s existence with the 100% exercise two years early of warrants issued as part of the restructuring agreement.