Empire Die Casting

Situation

Empire Die Casting Co., Inc. (“Empire” or “the Company”), headquartered in Macedonia, Ohio, is a precision die caster of a broad range of aluminum and zinc components including engine covers, pump housings and motor counter-weights for the HVAC and automotive markets.

In addition to die casting, Empire performs value-added secondary operations including CNC machining, vibratory and shot-blast de-burring, sanding, polishing and chromating.

In recent years, profitability and cash flow had deteriorated due to production inefficiencies which caused inflated overtime costs, premium freight charges, containment costs, and yield issues.

Solution

The Company engaged Amherst as the Chief Restructuring Officer (“CRO”) and interim CFO to assist in developing, evaluating and implementing strategic options through the restructuring process.

As CRO and interim CFO, Amherst worked with the executive management team to develop strategies for improving profitability, liquidity, and cash flow.

With the help of the Company’s counsel, Akron, Ohio-based Brouse McDowell, Amherst also managed relationships with the Company’s secured lender, creditors, and customers.

In order to maximize value for shareholders and creditors, Amherst initiated a sale process to identify a partner with the resources to fully implement the turnaround action plan.

Results

Amherst implemented a three-pronged project plan: (a) manage a timely sale of the operation to a qualified buyer with the capital and operational resources to effect the turnaround, (b) assist in managing and turning around the business, and (c) coordinate with the Company’s senior secured lender to maintain support for the process.

Leveraging the Company’s industry experience and relationships, Amherst initiated a targeted sale process and led multiple negotiations with several different parties in the industry. The Company was sold in a bankruptcy process to American Light Metals, whose executives have significant experience in operations and manufacturing, most notably with a Tier I automotive supplier.

The sale repaid the secured lender in full and the auction process yielded significant incremental funds above the initial stalking horse offer, which will provide a distribution to the unsecured creditors.