The Company is a mechanical contractor that services a wide range of commercial, industrial and institutional clients throughout the Midwest. Employing more than 1,300 people, their mechanical contracting services include:
–Industrial refrigeration, and
–The Company’s recent project work included petrochemical applications to refining facilities.
•The Company has been successful with new bidding on significant petrochemical projects, building its backlog to an estimated $110 million and significantly increasing revenue.
•The increased revenue combined with billing challenges and delays in cash collections, led the Company to begin experiencing large working capital needs with a peak need in the middle of the month to cover their large union benefit payments.
•Due to these factors, the Company accessed additional funds through an existing line of credit from its lender.
•However, due to continued successful bidding of work and continued delays in cash collections, the Company required additional funding to assist them.
•The Company engaged Fort Dearborn Partners to review and revise, as necessary, the Company’s forecasted financial statements, borrowing base, profitability and working capital needs.
Fort Dearborn Partners improved the Company’s cash forecasting abilities and validated project profitability, convincing the lender to increase its line of credit borrowings to fund the Company’s growth and future working capital needs.
Financing increased from $15 million to $22 million, with temporary increases up to $25.