Case Study: $107MM Transportation Company
Situation: Business was struggling with senior and subordinated debt amortization. Company required new capital structure in order to position the business for a successful sale.
- Company facing a covenant default on senior and subordinated debt
- Business deemed non-strategic to parent company, interested in selling, but needed to fix the capital structure prior to the sale
- New capital structure required to increase free cash flow, reduce near-term debt amortization, fund maintenance reserves and stabilize the business model
Solutions:
- Modeling of projections and development of capital structure alternatives
- Structured debt and prepared materials for new lenders
- Worked through lender issues and due diligence
- Managed loan agreement negotiations and closing
Results:
- Raised $135MM of senior secured long-term amortizing bonds
- Prepaid $120MM of medium-term senior and subordinated debt that could not be serviced by current forecasts
- Funded maintenance reserves
- Stabilized capital structure and paved the way for the successful sale of the company