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Case Study: Industrial Electric Machine Repair
Due Diligence, Liquidation Consulting
Company: $120 million service business that repaired
large electrical motors, transformers and breakers with 37 locations in
17 states.
Situation / Tasks Performed: The Company had made
many acquisitions over a 5 year period that were never fully integrated.
Information systems were on multiple platforms for the 37 remote operating
units. Though the Company had a centralized corporate structure, senior
management did not have the information to make informed decisions or control
costs. Suffering from lack of liquidity, it was not able to address supplier
pressure. Further complications occurred when the Company moved its corporate
headquarters from Chicago to Cleveland, leaving behind the most experienced
middle management. TRG was initially engaged as financial adviser to the
Bank Group, however, early in the process it became apparent that the Company
was not viable and the debt had to be restructured. The Sponsor concluded
that the best alternative was liquidation and a Trustee was appointed.
TRG continued to advise the Bank Group throughout the process, identifying
the Company's deficiencies and recommending various actions.
Results: Through the collective and cooperative efforts,
TRG, along with the Trustee and the appointed president of the company,
collected liquidation proceeds for the banks of approximately $30 million
or 57% of their debt, 19% over original estimates.
Nature of Assignment:
Primary: Due Diligence
Secondary: Liquidation Consulting
Industries: Service, Electric
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