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Case Study:
Distressed IT Firm Turned Around to Record Profitability |
Overview of Project
A leading national information technology firm offering a broad portfolio of technology and business solutions was financially and operationally distressed. Manchester was referred by the senior lender, engaged by the board of directors, and implemented a corporate renewal plan resulting in a complete turnaround. Our client is now operationally and financially restructured and positioned for profitable growth. |
The Challenge
The company is privately held with up to $150 million of revenue, but at the time Manchester became involved it had deteriorating revenues and significant losses. As a result, it was in default with its senior debt held with a large national bank and with its sub-debt held with a large equity fund. It also had management issues, an acute need for additional capital, and a shrinking market. |
The Engagement
Manchester was referred to the company by its senior lender and initially hired by the board of directors to conduct a multi-disciplinary assessment, which included financial projections that determined the company was viable as a going concern and also identified its capital needs. Subsequently, Manchester created and implemented a turnaround plan to restructure its operations and financial resources. |
The Solution
Working with the company, Manchester’s professionals stabilized the management team and provided interim executive roles as needed. We developed and implemented significant operational improvements to restructure the client to better serve its customers and its market. To support the company’s future and solve its financial problems, Manchester also negotiated and structured an infusion of $7.5 million of new capital as well as negotiated, restructured, and closed senior and junior debt in excess of $100 million. |
The Impact
At the end of Manchester’s engagement, the information technology firm was completely operationally and financially restructured and positioned for profitable growth.
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