Business case
Our client, a listed group headquartered in France, was contemplating the disposal of a loss-making branch of its business operating in specialty retail through a network of stores operated directly or under franchise. The process was monitored by a conciliator appointed by the Commercial Court.
In the context of a loss-making target leading to a negative-price operation for the seller, our work was critical to ensure the funding was consistent with the cash need required for the target’s turnaround. A trust mechanism was also put in place to ensure the allocation of funds granted to the buyer. In addition, we also regularly monitored the performance of the target after the transaction closed.
We prepared an independent business review for potential investors and assisted in the assessment of the offers put forward by potential buyers. We performed a detailed review of the buyer’s business plan and analysed the financing requirement over the first few years of the business plan. This included an assessment of: • the impact of operational restructuring (industrial footprint reorganisation, social plans); • the impact of real estate refinancing; • the impact of the carve-out (EBITDA & Working Capital impacts).