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Corporate Restructuring & Turnaround Benchmark 2025

Distress Indicators, Restructuring Strategies, and Recovery Outcomes

In-depth examination of corporate financial distress, restructuring strategies, and turnaround outcomes across mid-market companies. This benchmark study analyzes root causes of distress, effectiveness of various restructuring approaches (out-of-court vs. formal proceedings), stakeholder negotiation dynamics, and critical success factors for sustainable recovery.

Feb 10, 202525 min2.9 MBPreview 10 pages
BAM Monogram
Financial Strategy

Corporate Restructuring & Turnaround Benchmark 2025

Distress Indicators, Restructuring Strategies, and Recovery Outcomes

Feb 10, 2025

Executive Summary

Companies engaging professional advisors within 90 days of covenant breach achieved 73% successful restructuring outcomes versus 42% for delayed engagements, underscoring the value of early intervention.

Key Findings

1Corporate distress rates in mid-market increased 18% YoY, driven by elevated interest costs, weakening demand, and labor inflation.
2Out-of-court restructurings represented 68% of engagements, with median time-to-completion of 5.3 months versus 11.2 months for Chapter 11 proceedings.
3Successful turnarounds achieved average EBITDA improvement of 8.2 percentage points within 18 months through operational initiatives and cost rationalization.
4Lender forbearance agreements increased 22% YoY as banks preferred consensual solutions over formal bankruptcy with associated recovery delays and costs.
5Companies with strong pre-distress governance, financial reporting, and management teams were 2.3x more likely to emerge successfully from restructuring.

Table of Contents

Introduction & MethodologyPage 4
Distress Landscape & Root CausesPage 9
Restructuring Strategies & ApproachesPage 16
Stakeholder Dynamics & NegotiationsPage 24
Operational Turnaround InitiativesPage 31
Success Factors & OutcomesPage 38
Case Study: Retail Chain RecoveryPage 44
Best Practices & RecommendationsPage 50

Methodology

Comprehensive review of 215 mid-market restructuring and turnaround engagements completed between 2022-2024. Data sourced from BAM engagements, bankruptcy court filings, and industry databases. Includes quantitative analysis of financial outcomes and qualitative assessment of critical success factors.

Data Sources

BAM Restructuring Practice, bankruptcy court records, Debtwire, Reorg Research, company financial statements, lender interviews.

About the Author

陈(C

陈逸阳 (Yiyang Chen)

Managing Director, Restructuring

BAM's research collective synthesises market intelligence, governance benchmarks, and transaction casework to inform institutional decision makers.

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