HGP Industries was a large, multi-plant industrial tempered glass fabricator experiencing major declines in revenues and earnings due to industry overcapacity during a period of reduced commercial construction. The company’s secured lenders retained us to provide a viability analysis of the business.
The analysis included an evaluation of market conditions, the company’s competitive positioning, an operations review at each of the company’s twelve plant locations and a liquidation analysis. We concluded that the business had long-term viability if operational restructuring actions being contemplated by management were completed. A debt restructuring was the best course of action to enable maximum recoveries by the secured lenders. We participated with company management in jointly recommending that the lenders provide increased working capital advances on an interim basis.
Increased working capital funding was provided and a consensual restructuring of loan agreements was achieved. As market conditions improved, the business became highly profitable and the company was able to meet all debt service requirements on schedule. Oldcastle, Inc., the parent company of HGP, subsequently retained us to work on operational performance improvement projects for two of its other large subsidiaries.