Case Studies

Assisting Lender to Restructure Debt

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The Situation

Manufacturer of video delivery products. Annual revenues of $35 million. $17 million debt. Approximately 180 salaried and hourly employees are located in two locations.

  • The Company experienced a sharp revenue decline over the past two years, as a large percentage of sales were related to the conversion of Analog to Digital in the US markets.
  • Operating costs were not addressed quickly enough, resulting in significant liquidity constraints and cash burn.
  • Although management and the equity sponsor implemented an aggressive turnaround plan, leverage remained high, and the senior lender group lacked detailed information about the turnaround plan.

How We Advised

Our experts worked closely with the Company’s senior management team to review prior restructuring initiatives, vet current business plan assumptions, and assist the Company in assembling a comprehensive turnaround plan to present to the lenders.

  • Additionally, we assisted the senior lender in developing a covenant package that allowed the Company to execute its turnaround plan.
  • Our team worked closely with the senior lenders to evaluate alternative restructuring options.
  • The Company and equity sponsor were able to work with the lenders on an amendment to the credit agreement, which included a renegotiated covenant package.
  • The Company was pleased with our experts’ assistance and guidance during the assessment and bank negotiations and agreed to have us stay on to monitor management’s progress on executing its restructuring plan.

Key Contact

Dan F. Dooley, CTP 
Senior Managing Director 
Strategic Advisory Practice 
+1 603 660 8952 
[email protected] 

Related Practice Areas

> Debt Restructuring Services 
When a company is in financial distress, our Strategic Advisory experts design and implement debt restructuring and refinancing strategies tailored to the company’s unique circumstances. We help middle-market businesses stabilize operations, improve liquidity, and optimize their capital structures. 

 

> Turnaround and Restructuring Services 
Navigating the many challenges confronting a company in transition requires an operationally focused approach that looks beyond the balance sheet to minimize further degradation and build a path to sustainable growth. Drawing upon decades of experience in the turnaround space, we help companies in transition identify practical strategies to improve profitability and liquidity for immediate relief, while concurrently developing and executing a comprehensive turnaround plan for long-term, sustainable value creation. 

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