Diversified Global 500 Corporation
As part of a significant corporate acquisition client acquires a once major paper and pulp distribution business with three terminals at a port in England. Although a non-core business, it had some strategic land assets which over time were sold off at substantial profit. Subsidiary starts posting increasingly large monthly operating losses and the remaining major assets left in the company are the leasehold interests in the three terminals.
Aegir is called to analyse all options. A comprehensive valuation of the leaseholds is conducted during the beginning of the Great Recession. Although the leaseholds have value, the breadth, scope and depth of the global recession effectively shuts down any potential market for the disposal of the terminal leaseholds.
An in-depth analysis of the business and the development of a turnaround strategy is developed for the client. Upon reviewing the results, it is decided that although there is the possibility of turning around the business, the growth potential in the foreseeable future for the industry does not warrant the time or investment required to turn the entity around.
An immediate winding down plan is developed whereby Aegir and Drewry offer interim management services for the entity and a planned winding down programme for the business unit is undertaken. Within six months the business is effectively shut down, assets sold and negotiations with the landlord result in a quick termination of the lease, resulting in major cost savings to the client.
THE NET RESULTS:
Within six months the business is effectively shut down, assets sold and negotiations with the landlord result in a quick termination of the lease, resulting in major cost savings to the client.