Opportunities Through Turbulence: Takeaways from the 2021 TMA Australia Conference

Opportunities Through Turbulence: Takeaways from the 2021 TMA Australia Conference

By Kate White

As we emerge from this year’s TMA Australia National Conference, the enthusiasm around opportunities for dealmaking and innovation emerging from the pandemic remains strong.

In attending the conference, GLAS joined an audience of over 700 delegates from around the world, including leading lenders, borrowers, lawyers, accountants and others in the turnaround community. The group discussed the challenges and opportunities after pandemic re-openings, the impact of differentiated leadership, and other market dynamics.

Read on for some of the key themes discussed at the conference that are informing turnaround professionals’ decision making into 2022.

Businesses Navigate the New Normal Amid Pandemic Re-Opening

Though businesses have seen positive resurgence in recent months following the lifting of pandemic-related lockdowns, the fact remains that retail activity will be permanently changed emerging from the crisis.

While other global markets have larger e-commerce demand and capabilities, the Australian market is further behind. Businesses’ ability to adapt to a new environment of online shopping and the logistics that ensue will be indicators of the pace of growth and need for turnarounds in the retail space in the coming year.

At the same time, global economies are experiencing a labor shortage that is holding back pandemic recovery, and the Australian market is no exception. The war for talent is expected to be a key factor for business leaders, especially those in public-facing industries.

Lessons to be Gleaned on DIP Restructuring

Debtor in possession (DIP) restructuring proceedings are common in overseas markets, but questions remain about whether Australian businesses need a better mechanism for solvent workouts. Recent Australian restructurings may have highlighted the lack of equivalent DIP procedures.

U.S. Chapter 11 and the recently introduced English Restructuring Plan have been used to restructure businesses impacted by the pandemic. At the TMA Australia Conference, a healthy debate ensued about whether an overhaul of insolvency law is needed in Australia, and if so, what the best path is to pursue.

On one side, it was felt that Australia’s insolvency law was ripe for review and wholesale reform is necessary. On the other, views are held that management teams are well equipped to get distressed companies back on track, pointing to large businesses who have successfully restructured in recent years.

Lessons from the U.S., U.K. and Singapore can be drawn in considering where Australian restructuring laws may evolve in coming years. GLAS expects additional conversation around the future of Australian insolvency law to continue in the coming years as parties determine the balance between fostering business innovation and ensuring proper protections are in place in the cases of business failure.

Christine Holgate Highlights the Role of Leadership in Navigating Successful Turnarounds

GLAS was proud to sponsor a keynote session by Christine Holgate, who most recently led the turnaround of Australia Post and has recently been appointed CEO of Toll Global Express.

She highlighted lessons for the business community from her experience in coping with headwinds during the Australia Post turnaround, noting the substantial growth that resulted from the process. Through investment in new technologies, connecting with people in Australian communities, and a tenacious approach in understanding the customer base, Holgate was able to earn trust and put Australia Post in a position for future success.

Holgate also spoke about how vital diversity is to a successful modern corporation, a key focus for countries globally. She discussed her own role as a female CEO, and pointed to research demonstrating that diverse boards and organizations bring out strong solutions.

Holgate herself may have put the lesson on the power of strong leadership in turnaround situations best, saying: “There comes a time when all of us as leaders, we have to look inside ourselves and work out who it is that we want to be, and what we want to define us.”

As vaccination rates rise and global economies continue to navigate the pandemic recovery, there was sentiment among conference presenters and delegates that 2022 will bring a year of robust activity and capital deployment.

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