Alvarez and Marsal
| Company type | Private |
|---|---|
| Industry | Professional services |
| Founded | 1983 |
| Founder | Tony Alvarez II, Bryan Marsal |
| Headquarters | New York , United States |
Area served | Worldwide |
Key people | Bryan Marsal (CEO) |
Number of employees | 3000+ (2013) |
Alvarez & Marsal Holdings, LLC (A&M) is an international professional services organization that focuses on turnaround management and performance improvement for leading corporations, including Lehman Brothers, HealthSouth, Tribune Company, Warnaco, Interstate Bakeries, Target Corporation, Darden Restaurants, and Arthur Andersen.
History
Established in 1983 by Tony Alvarez II, previously a workout specialist at Coopers & Lybrand, and Bryan Marsal, a former workout banker from Citibank, A&M introduced an innovative professional services approach centered on corporate restructuring and enhancing operational efficiency. Their inaugural significant client in turnaround efforts was Timex Corporation. Throughout the 1980s and 1990s, the firm expanded gradually with a core team based in New York and a satellite office in Los Angeles by 1994.
During the 2000s, A&M broadened its service offerings beyond turnaround engagements to support private equity clients throughout various stages of investment, including due diligence, operational enhancement, and asset disposition. This strategic diversification contributed to notable revenue growth and increased market presence. By 2013, the company had grown to more than 3,000 employees across 55 offices worldwide, demonstrating robust expansion and global reach.
Lehman Brothers
When Lehman Brothers confronted impending Chapter 11 bankruptcy, Bryan Marsal was one of the initial professionals contacted by Harvey R. Miller on September 14, 2008. Marsal was designated as Lehman’s chief restructuring officer that same month and ascended to CEO in November, succeeding Richard S. Fuld, Jr. In a contentious decision during the asset liquidation process, Fuld was permitted to maintain an office but without compensation.
Following the collapse, approximately 20 Lehman employees remained after divestitures to Barclays and Nomura Holdings. Alvarez & Marsal deployed multiple partners and staff members as temporary executives. By September 2012, the firm had engaged fifty full-time executives along with over 250 bank personnel to manage Lehman’s asset wind-down.
HealthSouth
In 2003, amid investigations uncovering fraudulent financial reporting that overstated earnings by $1.3 billion and revealed actual losses of $1.8 billion from 1996 through 2002, HealthSouth enlisted Alvarez & Marsal to oversee its recovery efforts. Founder and CEO Richard M. Scrushy contested the fraud accusations.
Serving as CRO, Marsal implemented reductions of 250 corporate positions and divested underperforming hospital assets along with most of HealthSouth’s private aircraft fleet, which included a Gulfstream V and a $12 million Sikorsky S-76C helicopter. These initiatives were instrumental in preventing bankruptcy and facilitating the company’s return to the NYSE in 2006.
Industry reports
Alvarez & Marsal publishes a range of strategic analyses such as the A&M Activist Alert (AAA), which forecasts shareholder activism trends across Europe; the Banking Pulse Report, offering comparative insights into profitability and stability among major banks regionally; and the Shape of Retail series that examines performance metrics and evolving trends within the retail sector.
Competitors
Within turnaround consulting and interim management markets, Alvarez & Marsal competes with specialized firms including Berkeley Research Group, FTI Consulting, and AlixPartners. Since 2001, it has also vied with traditional management consulting firms like McKinsey & Company, Boston Consulting Group, and Bain & Company for engagements related to supporting both private equity investors and corporate clients.
Criticism
Certain rivals have raised concerns about Alvarez & Marsal’s approach to aligning business goals during restructuring projects, particularly highlighting the firm's recruitment of six turnaround experts from Arthur Andersen amid its collapse. Throughout the Lehman Brothers bankruptcy proceedings, A&M accrued fees approaching $500 million over a three-year span, positioning it among the costliest and most intricate bankruptcies handled as of 2013.
By December 2024, Alvarez & Marsal experienced a drop in profits following the allocation of £1 million compensation packages aimed at attracting personnel from leading accounting firms. Despite this, the company's European professional services revenue increased by 30%, reaching €570 million.