Howard Finishing, LLC – This industry-leading provider of coating and plating services to the automotive industry successfully operated two facilities outside of Detroit for years. After the automotive market crash of 2008, the company found itself under forbearance with its lender of 20 years. The debt was refinanced, but because this new lender was unfamiliar with the business, it began restricting availability almost immediately. In addition, a 13-week shutdown of their largest customer’s plant further impacted cash flow and led the secured creditor to tighten credit even more.
SC&H Capital was retained to explore strategic options for the company, including new money or an entirety sale. Due to SC&H’s involvement, the existing lender was comfortable enough to continue funding while an exhaustive marketing process was conducted. SC&H received multiple offers to buy the company, but ownership ultimately chose to refinance the debt with a new lender that seemed comfortable with the business and understood the need for access to a larger line of credit. The key customer’s plant returned to full operation, revenues increased, and the company’s collateral base grew, allowing it to access capital and the opportunity to enter into new market segments and long-term automotive programs.
