- One of the leading vertically integrated bedding providers in India, engaged in spinning yarns, weaving fabrics and manufacturing textiles
- Exports to over 45 countries with it being one of the leading suppliers of home textiles to USA
- Company’s operations were hit due to subdued global market alongwith increasing cotton prices and rupee appreciation
- Capacity utilization reached an all time low of 25%
- Experienced a disproportionately higher one time forex loss of ~ INR 1.5Bn, against revenues of ~ INR 2.8Bn.
- Substantial net worth erosion resulted in high DER of 8:1
- Promoters’ were unable to induct a new financial investor
- Criticality of enhancing of core working capital to run at optimum levels
- Restructuring of debt
- Induction of a strategic investor
- Poor valuation due to precarious financial position and industry scenario
Brescon Value Add
- Addressed the problem of one time forex loss by converting the same into term loan
- Due to inadequate security cover, innovative structure conceptualized which enabled securing of additional funds ~ INR 1Bn for working capital, by leveraging assets of one of its subsidiaries.
- With additional WC limits, company could tap the rising market opportunities by fully utilizing its capacity
- Resolution enabled the company to outperform the projections and exit from CDR before stipulated time
- Spectacular improvement in the financial performance and market capitalisation with EBITDA going up by over 20x and market capitalisation by over 70x during the period of 9 years ie. from prior to restructuring to exit from CDR.
- Derisking of loan assets for the lenders alongwith recovery of the recompense amounts.