EP's team is composed of an Executive Team, Advisory Committee and Support Structure that enable the efficient and agile resolution of the challenges on the Operational, Financial and Legal-Process fronts that companies face in a turnaround process
INVESTMENT CRITERIA
EP invests in companies:
… with solid business fundamentals:
- Sectors that are sustainable in the future, excluding real estate, financial related sectors, and those with significant technological risk
- Sales figures that are stable and higher than €5mn (realizable potential or peak sales considered)
- Capacity/ potential to export to international markets in the near future, with headquarters located in Spain
… experiencing difficulties in cash flow generation and/or balance sheet:
- Liquidity/ cash flow stress (misalignment of cash sources and uses, with new money required)
- Restructuring of balance sheet required to prevent that financing dislocation impacts on core business activity (e.g. deterioration of commercial terms with suppliers and/or clients) and to business solvency in the medium-long term
- Operational restructuring situations, as for example, segregation or segment carve-outs, in "Concurso de Acreedores" (Spanish legal code for governing Reorganization under Bankruptcy – similar to US Chapter 11)
TURNAROUND MANAGEMENT
Leadership of EP's team in turnaround management focused in:
1. Short term financial and legal management
Stop the emergency and deterioration – Stabilization of cash flow and legal/ process situation
- Information exchange, communication and negotiation with main stakeholders (financial institutions, suppliers, clients, partners, etc.)
- Financial stress management (weekly cash flow design and monitoring, supplier payment management, client collection plan, etc.)
- Legal and Process alternative evaluation (legal, tax, audit and labor team involved in the deal)
- Balance sheet and cash flow rebalancing through injection of funds for working capital and/or other requirements up to €2mn
2.Short and medium-term operational rationalization
Operational stabilization and Action Plan to unlock company's potential
- Action prioritization according to importance/ impact and urgency
- Design and implementation of a credible and feasible Action Plan to stop emergency and unlock company's full potential
- Strengthening of Management Team with sector expert(s) in operations/ commercial activities and/or operational reorganization/ improvement functions
- Development of an urgency and value creation culture/ mindset
- Short term operational improvement projects (e.g. fixed asset and/or human resources rationalization, alignment of operations and strategy)
3.Long term operational and financial management (LT)
Develop mechanisms for long term control and growth
- Development of projects and teams to materialize potential (e.g. optimization of client profitability and volume, margin enhancement, product mix, etc.)
- Design and implementation of a LT financial and operational structure aligned with company's requirements (e.g. LT financial growth debt structure, export team development, tax optimization, etc.)