Areas of operation:
The German subsidiary of a large US company in Chapter 11 had experienced significant operational problems caused by vendor disruption resulting from the parent company filing. The German company had recorded a negative EBITDA of $3.1 million in a quarter and was close to insolvency.BM&T Principals worked as both CRO and Treasury managers alongside the company management to improve production flow, reduce inventories and improve cash flow and vendor confidence. The company was restored to a positive quarter EBITDA of $1.1million. Subsidiaries in Spain and France were downsized and disposed of to generate cash. German operating costs were substantially reduced. BM&T Principals worked with the company’s legal advisors to manage the company through German potential over-indebtedness issues. Actions to stabilise and maintain continuity of the European operations were a vital contribution to the eventual sale of the USA business.
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Notes, insights and reflections from Matthew, one of our directors and turnaround experts, as he works with companies during Lockdown.