Case Study: Capital Market Services

Restructuring Advisory Services & Transaction Support

Our Client

A global banking institution with over $1 billion in debt outstanding to a financially distressed U.S. public company under various revolving credit, term loan and senior loan facilities

Situation

The bank retained The Salter Group to prepare an independent assessment of (i) the company's ability to pay its current and future obligations based on (a) analyst forecasts and projections, (b) company-prepared forecasts and projections, and (c) sensitivity-based growth and decline models, (ii) the value of the company's assets relative to its liquidated and conditional obligations based on (a) company-prepared balance sheet forecasts and projections, and (b) sensitivity-based growth and decline models, and (iii) the fair market value of the company on a going-concern enterprise basis by using the income (DCF) approach while also considering the market approach (by analyzing comparable public companies and transactions) as a reasonableness test to the income approach.

Key Issues/Services

Assisting the bank, with the company's support, in preparing forecasts reflecting the company's base-case operating plan, as well as certain strategic alternatives outlined by the company and its advisors
Evaluating the company's business plans and strategic alternatives with reference to industry growth rates and market conditions in order to bolster the defensibility of our financial analyses

The Salter Group's Role & Outcome

We delivered a presentation to the bank outlining our financial analyses under the base case and strategic alternative scenarios.
We assisted the bank in evaluating the financial implications of various debt restructuring alternatives in order to maximize the bank's prospects for receiving the total amount due from the company.

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