Case Study

Undisclosed Facilities Management Company


Gordian Group acted as financial advisory to the Company and was able to assist the Company in procuring a restructuring that resulted in a significant reduction of debt and an option for the sponsor to buy back into a majority position.


The Company, which was a roll-up of several smaller businesses, had not performed as expected, with EBITDA having fallen from close to $25 million to less than $10 million, and was burdened by approximately $200 million in debt. The Company was burning cash to pay interest and was facing a liquidity crisis.

Gordian was hired just prior to an event of default, and following a period of unsuccessful restructuring negotiations between the sponsor and lender, as the lender, which had a minority equity stake in the business and equity stakes in other similar businesses, appeared prepared to take the business.

Gordian immediately went to work to assess the Company’s restructuring alternatives, and which included a detailed analysis of the credit documents.  Through these efforts, points of leverage were identified, including the ability to sell assets and stretch trade vendors to fund liquidity and debt service without tripping any covenants or putting itself in an event of default. Ultimately, these pressure points were essential in bringing the lender to the table.


The Company is a private, sponsor-backed player involved in facilities management and energy procurement, offering products and services to large organizations.


Not long after this idea was presented, the Company signed a forbearance agreement and began progressing conversations with its lender. The Company eventually agreed upon a restructuring that resulted in a reduced debt load for the Company — nearly $200 million in secured debt was reduced to $25 million in secured debt and approximately $50 million in preferred.  The lender also provided incremental liquidity in the form of a new revolver and PIK interest (in lieu of cash) for two years.  Despite the significant deleveraging, the sponsor was able to retain a minority equity position in the develeraged business and an option to leg back into a majority position.