Strategic & Operational Strength: Comprehensive Solutions for an Automotive Supplier
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October 25, 2023
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Lacking financial transparency and sound operational processes, an automotive supplier engaged FTI-Andersch to identify the root causes behind the challenges it faced and enact comprehensive solutions.
Our Impact
As a result of FTI-Andersch’s expert restructuring opinion, the supplier received EUR50 million in fresh capital from lenders during the lockdown and its aftermath, helping to continue its operations.
- FTI-Andersch’s work supported the case for more robust resourcing of the company’s finance department.
- The team provided process stability and financial transparency, helping the company’s shareholders start exiting their investment. The engagement is still ongoing, with FTI-Andersch providing support in various areas including management of cash and working capital.
Situation
Germany’s first national pandemic lockdown hit a Tier 1 automotive supplier hard. Many original equipment manufacturers who had maintained optimistic forecasts were forced to cancel their call-off contracts at the last minute, rendering business operations uncertain and effects on liquidity difficult to predict. Deficits in financial controls exacerbated these issues. To avoid a liquidity shortage, the supplier’s shareholders and lenders agreed to a debt equity swap and bridge financing, with the precondition that the supplier would secure a restructuring opinion. In May 2020, the client engaged FTI-Andersch, the consulting unit of FTI Consulting in Germany that specialises in restructuring, business transformation and transactions, for expert assistance following prior positive experiences with the firm.
Our Role
- FTI-Andersch prepared a restructuring opinion to facilitate the provision of fresh capital and retain relevant trade credit insurers.
- The team advised the CFO on strategic and operational improvements as well as relevant corporate functions by: 1) offering support on transparency for foreign production sites, 2) helping develop integrated financial controlling tools and processes and 3) managing liquidity and working capital.
- FTI-Andersch supported efforts around communications and reporting to investment funds with a stake in the company.
Published
October 25, 2023
Key Contacts