Mechanical Contractor

Company Overview

Mechanical Contractor - The Company is a $230 million mechanical contractor that services a wide range of commercial, industrial and institutional clients through out the Midwest. Employing more than 1300 people, their mechanical contracting services include:

• Process piping,
• Industrial refrigeration, and
• HVAC

The Company’s recent project work included petrochemical applications to refining facilities.

Engagement Overview
•  The Company has been successful with new bidding on significant petrochemical projects, building its backlog to an estimated $110 million and significantly increasing revenue.

•  The increased revenue combined with billing challenges and delays in cash collections, led the Company to begin experiencing large working capital needs with a peak need in the middle of the month to cover their large union benefit payments.

•  Due to these factors, the Company accessed additional funds through an existing line of credit from its lender.

•  However, due to continued successful bidding of work and continued delays in cash collections, the Company required additional funding to assist them.

•  The Company engaged Fort Dearborn Partners to review and revise as necessary the Company’s forecasted financial statements, borrowing base, profitability and working capital needs.
Results

Fort Dearborn Partners improved the Company’s

cash forecasting abilities and validated project

profitability, convincing the lender to increase its

line of credit borrowings to fund the Company’s

growth and future working capital needs.


•  Financing increased from $15 million to $22 million, with temporary increases up to $25.