Postern has a track record of de-risking lenders by working with their client companies to ensure their profitability and cash generation. Our services help companies avoid breaching covenants and helps lenders minimise or eliminate debt write-downs. We are able to assist lenders in covenant resets ensuring the alignment of a business’ operations and cash generation with covenant obligations.
Through our Postern Strategic Diagnostic Review we are able to assist in identifying key issues, outline areas for business strategy and operational improvement, where possible stress/distress lie and implement corrective action, as well as identify growth strategies and optimise stakeholder positions, de-risking and maximising financial returns.
Postern pioneered team based, ‘hands-on’ transformational management. We assess through an “active management review” carried out by our experienced business practitioners, the issues faced by the business and its management. We are able to supplement and organise the senior management team of a business, as appropriate, to focus on these critical issues. We recognise the experience and skill of incumbent management. But, we also appreciate that bad habits, strategic fixations, lender pressure, fear of failure and inability to innovate, are important barriers to change. At Postern we are experienced at changing where change is necessary.
Developed from expertise gained from many medium and large company restructuring and transformational assignments, Postern has built a sophisticated ‘hands-on’ cash management system. Our experience is extensive as many of our assignments often come to us with acute cash-flow problems.
Using our own proprietary systems for cash management, we are also able to provide training for client staff as and where necessary, allowing management to once again concentrate on the issues that led to the cash problems free of distraction.
Delivering Value, De-Risking Lenders and transforming Companies
Particular Areas of Focus
Example Case Studies
Postern was asked by the shareholders to review this publicly quoted circuit board manufacturer that was losing money and facing severe bank problems. A report with recommendations was submitted within five weeks.
Postern was then invited to take executive control and immediately set about closing a loss-making subsidiary, selling another subsidiary to management and leading a successful rights issue which alleviated bank concern over high gearing.
Within twelve months the company was profitable, the share price had risen by over 50% since the rights issue, preference dividends were brought up to date and shareholder value restored. Postern recruited and developed a new executive team for the company and stepped down at the subsequent AGM.
This was a £500 million UK public company with manufacturing plants in the UK and the US. A number of domestic and international banks had lent substantial and unsecured amounts. Two profit warnings had led to a collapse of the share price and the resignation of the chairman/chief executive and the finance director. The non-executive directors asked Postern to assists the board in the control of the company and to seek an accommodation with the banks.
Postern’s review showed that the net assets of the company had been overstated and the total indebtedness to the banks had not been fully recognised. The company was in crisis with its creditors and an accountant’s report claimed negative net worth.
In spite of this background Postern was able to demonstrate a viable future for the company, negotiated a standstill agreement with the banks together with increased and extended facilities from the consortium of lends. Postern developed a strategy of major disposals and cost-cutting and then exited on the appointment of a new chief executive. The strategy was successfully implemented, the banks were paid out in full and shareholder value was re-established.