NATURE OF ASSIGNMENT:
Primary: Company Services / Due Diligence Assessment
Primary Industry: Distribution & Logistics
Company: $300 million vertically integrated poultry producer and distributor.
Situation: The Company was seeking to recover from an over-expansion into specialty packaging of its end product. This expansion had not resulted in the anticipated increase in revenues necessary to support the high volume food packing infrastructure that the Company had built over the preceding three years.
Focus Scope: A lender contemplating financing the restructure of the Company sought assistance from Focus to help assess the likely impact on the Company’s financial performance following the sale of one of its production facilities. The lender was concerned that rising commodity raw material price changes would jeopardize the viability of the remaining operation.
Tasks Performed: Focus undertook a Situation Analysis that incorporated review of the Company’s projection, preparation of a bridge schedule showing the likely impact of the proposed restructure of the Company, and preparation of pro-forma financial statements and cash flow forecasts. Focus provided covenant recommendations to the lender specifically addressing the commodity price issues.
Results: Focus Management Group's involvement resulted in the lender approving the credit opportunity with reduced commodity pricing risk.