There have been cases in the past, where companies facing bankruptcy have been turned around by new management, even keeping the old employees. Jaguar, Chrysler, Delta (GM subsidiary, not airline) are a couple that I recall...even Apple, when Steve came back and took over again from the "professional managers." Therefore one cannot underestimate the influence of good new management. If new crews come in, the company could be great in a short order.
Of course, the opposite happens as well. Really need both chiefs and Indians. Not to doubt the challenges facing the new guy, but all hope is not lost.
Good luck to him and good luck to the new people coming in!