Steel Service Center - a leading value-added steel service center providing precision shearing, slitting, leveling, cutting, edging and sawing services to original equipment manufacturers and steel fabricators in multiple end markets including heavy-duty truck parts, military equipment, medical equipment, industrial cabinetry, industrial racking, recreational vehicle manufacturing and others.
Due to an economic downturn and significant decreases in steel prices during the fall of 2008, the Company experienced declining revenues and incurred operating losses.
Despite cost cutting efforts, the Company was unable to operate within its senior bank line-of-credit facility or to service its debt. As a result, the owners decided to sell the business.
The Company engaged Fort Dearborn as its exclusive financial advisor.
Fort Dearborn used its profit improvement consulting skills to identify and implement additional cost reduction initiatives that resulted in an increased selling price. Subsequent to closing the transaction, Fort Dearborn assisted in negotiating a favorable settlement with the buyer regarding working capital adjustments.
Challenges to completing the transaction included maintaining the senior lender’s confidence that a sale transaction could be consummated and keeping multiple bidders interested despite the divergence of their goals and the Company’s increasing level of financial distress.
Despite these challenges, Fort Dearborn was able to consummate the transaction within 120 days from its engagement.
The Company sold substantially all of its assets, including it’s real estate, to a regional competitor through an Assignment for the Benefit of Creditors.
Fort Dearborn played a vital role as the Company’s exclusive financial advisor, identifying and screening potential buyers, negotiating the terms of the sale and closing within 120 days.