Puneet Varma (Editor)

Alvarez and Marsal

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Type  Corporation
Founded  1983
Industry  Professional services
Area served  Worldwide
Founder  Tony Alvarez II, Bryan Marsal
Key people  Tony Alvarez II (Co-CEO) Bryan Marsal (Co-CEO)

Alvarez & Marsal (A&M) is a global professional services firm notable for its work in turnaround management and performance improvement of a number of large, high-profile businesses both in the USA and internationally such as Lehman Brothers, HealthSouth, Tribune Company, Warnaco, Interstate bakeries, Target, Darden Restaurants and Arthur Andersen.



Alvarez & Marsal was founded in 1983 by Tony Alvarez II, former Coopers & Lybrand workout specialist and Bryan Marsal, a former Citibank workout banker, after the two met and worked together at Norton Simon Inc. They created a professional services firm focused on turnaround management, corporate restructuring and operational performance improvement in an area where previously individual executives operated. The first turnaround client of the firm was Timex Corporation. A&M grew slowly through the 1980s and 1990s with a small team focused on restructuring based in New York and, by 1994, a satellite office in Los Angeles.

During the 2000s, while continuing to specialise in turnaround work, and continuing to take executive and Chief Restructuring Officer roles, the firm expanded its practice and grew its revenues with much of the increase coming from private equity firms that hired A&M’s for services across the investment life cycle from due diligence and performance improvement through to asset sales.

By 2013, Alvarez & Marsal had grown to approximately 2500 personnel working from 40 offices globally.

Lehman Brothers

Bryan Marsal was reportedly one of the first people contacted by Harvey R. Miller on hearing that Lehman Brothers was likely to need to file for Chapter 11 protection, receiving a call at 10:30 at night on September 14 while he was watching a football game. Marsal was appointed as Lehman’s Chief Restructuring Officer in September 2008 and in November he was named Lehman’s CEO, replacing Richard S. Fuld, Jr. Somewhat controversially, Marsal allowed Fuld to retain an office at the failed bank, "if he has nowhere better to go", although Fuld was not paid for his assistance in unwinding the assets of the bank.

Lehman Brothers was left with about 20 employees following its failure and sale of units to Barclays and Nomura Holdings and subsequently appointed a number of Partners and staff from Alvarez & Marsal to serve as interim executives for the bankrupt bank. In September 2012, there were fifty full-time Alvarez & Marsal executives working on unwinding the assets, along with over 250 staff employed by the bank.


When HealthSouth found itself subject to far reaching fraud investigations in 2003, which resulted in its top management admitting to fraud, the company found itself with an overstated income of $1.3 billion between 1996 and 2002, while it had suffered an actual loss of $1.8 billion. The company's founder, Chairman, and Chief Executive Officer, Richard M. Scrushy denied the fraud. The company soon hired Alvarez and Marsal to lead the 'turnaround' and to do the hard work necessary to stabilize the company so that problems could be corrected and recovery started. At HealthSouth, Marsal who served as CRO cut 250 jobs at HealthSouth's corporate campus in Birmingham and sold off assets such as poorly performing hospitals and all but two of HealthSouth's fleet of 12 private jets that included a Gulfstream V, multiple Cessna Citation's, and a $12 million Sikorsky S-76C, that the business had accrued. As a result, the company avoided bankruptcy and relisted on the NYSE in 2006.


Alvarez & Marsal often competes for its traditional turnaround and interim management work with other specialty firms such as FTI Consulting and AlixPartners, and since 2001 has been competing with more traditional consulting firms for work supporting Private Equity funds.


Competitors have suggested that Alvarez & Marsal has boosted its own business while restructuring failing companies, pointing to a deal with Enron Corp.'s accounting firm, Arthur Andersen as an example. While dismantling Andersen, they note Alvarez & Marsal hired six turnaround specialists from the firm. At Lehman Brothers, Alvarez and Weil Gotshal were noted to have received nearly $1Bn in fees over the three years following the banks collapse making the Lehman bankruptcy the most expensive in history as at 2013.


Alvarez and Marsal Wikipedia