The Starting Point
The company began as a weaving mill and, starting in the 1940s, specialized, the first company in Italy, in fiberglass weaving. The last ownership, a family active in the trade of materials for the marine industry, had gone into difficulties due to the 2008 crisis, which had reduced the marine market by 70 to 80 percent, and had decided to file for bankruptcy.
I4D, after a quick assessment, decided to attempt a relaunch by leasing the business.
Lines of action of corporate restructuring
Corporate restructuring consisted of the following actions:
- Creation of an industrial accounting system that made it possible to identify the margins of different products and thus to properly target the sales network
- Customer selection, eliminating those deemed financially unreliable, even at the cost of reduced sales
- Outgrowing domestic suppliers, and sourcing raw material directly from Chinese suppliers
- Internal reorganization and maniacal cost control.
After some trials, reliable suppliers in terms of quality and price were selected with the effect of lowering the purchase cost of raw material by about 30 percent.
Industrial accounting made it possible to identify several items that were being sold below cost or with absolutely insufficient margins; therefore, the product list was adjusted and a price adjustment campaign was carried out at all affected customers.
Finally, customer selection and credit insurance brought risk back within completely reasonable limits.
The effects of the imprinted changes enabled the company to make a profit from the first fiscal year and quickly achieve a high bank rating.
The owning company, meanwhile, fails to meet its commitments under the composition plan and goes bankrupt. I4D participates in the auction and acquires the business from the bankruptcy trustee, with no further capital contribution.
Exit from the intervention
After 5 years of operation-always making a profit-the company is resold to new generation members of the original owners’ family.
