Letts Industries

Situation

Letts Industries was a family-owned collection of seven businesses in various automotive and manufacturing sectors. The core operation was a profitable manufacturer of precision-machined heavy components for the light truck market.

The company was in default with its senior lender, was being shut off by key suppliers and under intense scrutiny by OEM customers. Its non-core affiliates had posted substantial losses and drained liquidity from the consolidated operation.

Solution

Amherst was engaged to assist the company in managing its cash flow to maintain the operation while advising on strategic solutions.

Amherst devised a plan to isolate and shed non-core affiliates, restructure the company’s trade debt, refinance its senior bank debt with enhanced asset-based credit availability, and maintain the cooperation of customers throughout the process.

Results

Within 60 days of beginning its engagement, Amherst fully implemented the planned strategy.

The company emerged with a tight focus on core operations, the senior bank debt was fully paid out, additional new credit availability was obtained in the refinance, vendor debt was restructured without discounts, and customers received uninterrupted part production throughout the process.

The Company restructured its holdings and formed Power & Sons.