Saving SMEs from Bankruptcy: A Practical Plan

Saudi Arabia’s contracting sector, a critical driver of Vision 2030’s $1.5 trillion infrastructure projects, faces significant financial challenges that threaten profitability and growth. Issues such as delayed client payments, high debt levels, and rising material costs create financial distress for many firms, necessitating corporate restructuring and restructuring consulting. Waslat Alamal, a trusted leader in restructuring advisory, offers tailored restructuring advisory services to help contractors navigate these challenges and align with the Wafi Program, Saudi Arabia’s initiative to ensure financial transparency in construction and real estate. This blog explores how Waslat Alamal’s corporate financial restructuring and corporate reorganization empower Saudi contractors to overcome financial distress and secure a competitive edge in a dynamic market.

Financial Challenges in the Saudi Contracting Market

The Saudi construction industry, valued at $147 billion in 2024, is central to Vision 2030 projects like NEOM, Qiddiya, and the Red Sea Development. However, a 2025 industry report highlights that 30% of contractors face cash flow disruptions due to delayed government payments, which can stall projects and erode profits. High interest rates on loans and escalating material costs, driven by global supply chain issues, further exacerbate financial distress, making the restructuring of distressed companies essential.

The Wafi Program, launched to promote compliance and financial health in construction, requires firms to maintain robust financial structures to secure government contracts. Without strategic intervention, contractors risk insolvency, project delays, and loss of market share. Waslat Alamal’s restructuring consulting and implementation addresses these challenges by providing data-driven solutions to restore financial stability.

Objectives of Restructuring for Contractors

The objectives of restructuring are to restore liquidity, reduce operational costs, and ensure long-term viability in a competitive market. Corporate financial restructuring focuses on refinancing high-interest debts and optimizing cash flow, while corporate reorganization streamlines internal processes to align with project demands.

Waslat Alamal not only provides restructuring advisory but also actively implements tailored restructuring strategies, ensuring that contractors meet Wafi Program standards and position themselves to compete for high-value contracts effectively.

Steps of Corporate Restructuring with Waslat Alamal

Waslat Alamal employs a structured approach to the steps of corporate restructuring, tailored to the unique needs of Saudi contractors:

Financial Diagnosis: Conduct a comprehensive analysis of cash flow, debt levels, and operational inefficiencies to identify distress points.
Strategic Planning: Develop a corporate restructuring plan that includes debt renegotiation and cost-cutting measures aligned with Saudi Arabia’s Bankruptcy Law.
Operational Streamlining: Implement corporate reorganization to optimize project management and resource allocation, cutting costs by up to 20%, according to 2024 industry benchmarks.
Performance Monitoring: Use advanced analytics to track progress and ensure sustainable financial health.

This process minimizes operational burdens and ensures compliance with the Wafi Program’s financial transparency requirements, enabling contractors to focus on project delivery.

Types of Restructuring for Saudi Contractors

Waslat Alamal offers various types of restructuring to address specific challenges in the Saudi market:

Corporate Financial Restructuring: Refinances high-interest loans and extends payment terms, critical for firms facing delayed client payments.
Corporate Reorganization: Optimizes workforce and supply chain processes, reducing overhead costs.
Strategic Restructuring: Repositions firms to focus on high-growth sectors like sustainable construction, aligning with Vision 2030’s environmental goals.

These restructuring advisory services ensure contractors remain competitive in a market where 40% of firms face profitability challenges due to cost overruns, as reported in 2024.

Waslat Alamal’s Expertise

Waslat Alamal’s restructuring consultation and implementation leverages 20+ years of deep knowledge of Saudi Arabia’s construction sector and advanced financial modeling to deliver measurable results. By aligning with Saudi Arabia’s Bankruptcy Law and Vision 2030 objectives, Waslat Alamal ensures contractors can navigate financial distress and capitalize on opportunities in mega-projects.

Addressing Market Challenges

Fluctuating oil prices and global supply chain disruptions continue to impact project funding, while the Wafi Program demands financial transparency. Waslat Alamal’s corporate restructuring optimizes cash flow, and its restructuring advisory ensures compliance with local regulations, enabling contractors to deliver projects on time and within budget.

Conclusion

Financial distress poses a significant threat to Saudi contractors, but Waslat Alamal’s restructuring consulting and restructuring advisory services provide a path to stability. Through corporate financial restructuring, corporate reorganization, and a structured steps of corporate restructuring process, contractors can overcome cash flow challenges and align with the Wafi Program. With a proven track record of helping firms reduce debt and boost profitability, Waslat Alamal is the trusted partner for Saudi contractors aiming to lead in Vision 2030’s construction boom. Partner with Waslat Alamal to transform financial distress into sustainable success.