Case Studies
J.S. Held Acquires GLI Advisors, Strengthening Our Construction Project Support Services in the Western US and Hawaii
Read MoreThe client was one of the largest pile-driving companies specializing in municipal, state, and large industrial projects. Located in New Jersey, it is owned by a private equity fund and an entrepreneur investor.
Our experts were engaged by the Company at the direction of investors who had purchased the pile-driving division of another company a few years earlier. The acquisition was supported by a working capital revolver, two term loans, and additional equity capital. After a strong start, an economic slump caused the company to show losses. The bank became concerned and requested cash flow and borrowing base projections from the company on a go-forward basis. The CFO, having had limited experience in a leveraged banking relationship, was having difficulty producing the requested documentation. The bank requested that an outside advisor be retained to assist the Company with the projections. Further, the Company had a significant amount of its receivables tied up in project retainage. The bank granted lesser availability and a very tight cap on the retainage, from which the company sought liquidity relief as part of the advisor retention.
Our team worked closely with the CFO to produce a 13-week cash flow forecast and a borrowing base roll forward. In addition, we collaborated with the Company to produce a monthly version of the cash forecast that was more closely aligned with the Company’s financial plan, and assisted the Company in establishing a weekly scorecarding process with accompanying narrative. These enhanced forecasts, reporting processes, and procedures provided the Company with greater insight into its liquidity position and significantly increased the level of credibility with its lender. This increased visibility and credibility allowed our experts, in conjunction with the company’s management and ownership, to negotiate an increase in the working capital availability retainage cap, thereby providing an eventual permanent liquidity solution for the Company.
Brian F. Gleason, CTP
Senior Managing Director
Strategic Advisory Practice
+1 610 659 8118
[email protected]
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