Wind Down and Transition of Customer Volume Without a Legal Process

Metals & PlasticsPerformance ImprovementTurnarounds & Restructuring

20M

Annual Sales

5M

in Debt

MetalWorks Worldwide, Cleveland Ohio

Challenge

Metal stamping company. $20 million in annual sales. $5 million debt. Business dependent upon Detroit automakers.

  • The Company, which was dependent on the Detroit automakers, saw its volume shrink by 50% in less than six months.
  • Management was able to stabilize and save the business.
  • The automakers then announced an extended holiday shutdown of 6 to 10 weeks.
  • Potential private equity investors disappeared, cash-flow losses started to grow, and secured stakeholders froze all lines of available credit.

Solution

  • MorrisAnderson was brought in to develop a restructuring plan.
  • As part of the engagement, MorrisAnderson developed a new strategy to transition the company’s volume to alternate suppliers smoothly, without filing a bankruptcy petition.

Results

  • The non-adversarial approach implemented by MorrisAnderson worked.
  • OEMs got the parts they needed without any business interruption, tooling was transitioned to new suppliers, the secured lenders were paid out in whole as the PPE was sold off, and the company is expected to realize 60-80 cents on the dollar with the real estate liquidated.
  • The restructuring plan was accomplished in 75 days with costs well below what they would have been in a contested Chapter 11 proceeding.