Conway MacKenzie has played a leading role in some of the most significant automotive restructurings and transactions during the last quarter century. The world’s largest publicly traded auto supplier at the time was facing issues that afflicted much of the domestic automotive industry – excess capacity, slackening demand and crushing legacy liabilities. These challenges led it to seek protection under Chapter 11 of the Bankruptcy Code. Revenues had grown $30 billion prior to Chapter 11. After three years in bankruptcy, a transaction involving a hedge fund failing to close would have resulted in the company’s emergence from bankruptcy.
Conway MacKenzie was engaged as Financial Advisor to the largest DIP Lender, eventually working with other DIP Lenders’ advisors to help the company emerge from Chapter 11. The Conway MacKenzie work plan was executed in four distinct but strategically connected phases that ultimately resulted in a consensual transaction, maximizing value for all stakeholders and avoiding disruption in supply to major customers:
- Developed independent views of liquidation values of the company to support arbitration process
- Performed financial, operational, and strategic due diligence
- Developed business plans and cash flow models to support multiple transaction scenarios required to bring key stakeholders to the negotiation table
- Integrally involved in key stakeholder negotiations, including U.S. Treasury and GM
- Assisted with capital raising to support required financing for each transaction scenario
- Prepared with counsel for potential adversary proceedings
- Provided financial and analytical support for all post-closing work streams
- Assisted in development and implementation of post-emergence action plans
The company successfully emerged from Chapter 11 as a $10 billion automotive supplier with significant operations in North America, Europe, Asia, and South America.