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.
A US Financial institution sought assistance in evaluating an export factoring line for a US company in Chapter 11 based on sales of product manufactured in a German subsidiary. BM&T’s German Managing Director evaluated the structure of the European group, the viability of the German operation, and together with legal counsel, the risk of statutory insolvency in the German company. Based on this assessment the USA institution was able to make an informed assessment of risk associated with the transaction and declined to participate. Soon after, the subsidiary was forced to file for insolvency.
A major Global Auto manufacturer engaged BM&T Principals to advise on its risks, options and exposure in the 26 European subsidiaries based in 9 countries of a $4 billion USA auto parts supplier in Chapter 11. BM&T Principals assisted in managing OEM cash flow support whilst the insolvency jurisdictional filing options were being assessed by the supplier’s management. Following the filing under a UK COMI, BM&T Principals advised a leading Private Equity buyer in due diligence to determine the viability of each entity and to establish the optimum group of entities which were subsequently acquired from the administration process.