Distressed companies only have evens chance of survival

Ailing companies have only a 50% chance of staying above water in a recession, thanks to poor treatment from lenders and bad management, a PricewaterhouseCoopers and Daily Telegraph study has found.

A survey of 150 turnaround specialists also found that banks are reluctant to help companies restore financial health, and are more likely to resort to insolvency.

Most at risk are businesses in the automotive, construction, hospitality, leisure and property sectors, the specialists said. They noted there had been minor improvement among the retail sector, whose prospects went from 'very poor' to 'poor'.

Managers came under fire for setting up inappropriate capital structures with too much debt.