Consumer & OEM Plastics Provider

The Situation

  • Plastic blow molder with a line of proprietary retail products and a provider of custom OEM parts across a number of industries
  • Missed retail deadlines, an outstanding EPA violation, and one of two facilities falling behind, led to declining operating performance; numerous forecasts were missed; company would soon violate covenants in their loan agreements
  • Key OEM customers were lost and the pipeline became underdeveloped

Role(s)

  • CRO
  • Financial Advisor

The Work

  • Financial Advisor to address missed forecasts, ultimately engaged as CRO
  • Reorganized product development team to address failed regulatory aspect of a new product and hasten its introduction
  • Recruited new plant leadership and established task forces to isolate and tackle the issues associated with evaluation of relationship with three specific OEM customers
  • Developed action plan to resolve commercial concerns and created CapEx program to deal with internal issues
  • Negotiated with senior secured lender to recast the balance sheet
  • Resolved issues with OEM customers, and determined company infrastructure was insufficient and unable to economically produce higher tolerance products

The Results

  • CR3 secured regulatory approval for the new product and settled outstanding EPA violations
  • Due to insecure infrastructure, funding could not be secured for sufficient plant and equipment improvements – engagement team undertook sale process for one of the two facilities, the consumer products business and a partial book of the OEM segment
  • Team’s diligent handling of sale ensured jobs and the associated enterprise value were preserved; remaining facility and associated equipment were sold separately for asset value

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Overview

  • Manufacturing
  • Restructuring and Turnaround

Engagement Team