|
|
|
| Houlihan Lokey's Capital Markets and Special Situations Experience |
| |
|
Houlihan Lokey is pleased to announce the successful out-of-court restructuring of Constellis Holdings LLC, restructuring more than $1.4 billion of debt. The transaction closed on March 27, 2020.
Based in Herndon, Virginia, Constellis is a leading provider of essential risk management services, such as security, training, and global support services to governments and commercial clients across the world. The company serves a diverse base of customers, including U.S. civilian, defense, and intelligence markets; foreign governments; international organizations; and commercial customers in approximately 30 countries around the world. The company’s safety and security services help protect critical infrastructure with inherently complex security requirements, such as nuclear-related sites, embassies, and other federal buildings. Apollo Global Management acquired Constellis in September 2016 and owned the company prior to the close of the restructuring.
In November 2019, Houlihan Lokey was engaged by an ad hoc group of first lien lenders to address the company’s immediate liquidity needs and ultimately negotiate an out-of-court restructuring which meaningfully reduced leverage and provided additional liquidity to support the company’s business plan. As a result of the debt-for-debt and debt-for-equity exchanges completed in March 2020, Constellis reduced its debt burden by approximately $1.1 billion and its annual cash interest payments by up to $90 million, while adding up to $50 million in new capital to support operations.
|
Houlihan Lokey's Capital Markets and Special Situations Experience
Houlihan Lokey is well known as the No. 1 U.S. M&A advisor and No. 1 global investment banking restructuring advisor, all based on number of transactions and according to data provided by Refinitiv (formerly Thomson Reuters). Constellis is one of 75 restructuring assignments completed by Houlihan Lokey during the past year. Our complementary, solution-oriented Capital Markets platform enables us to address potential near-term liquidity needs so that our clients can maintain maximum operational flexibility and accomplish their most important strategic and financing objectives during this period of economic uncertainty created by the current public health crisis. Houlihan Lokey has one of the largest capital markets teams on Wall Street at a non-balance sheet bank and raised more than $12.5 billion across approximately 40 transactions in the past 12 months. Our services and experience span the range of bespoke solutions, including
- Negotiation of credit amendments and extensions;
- Placement of private capital (senior debt to minority equity);
- Liability management;
- Comprehensive refinancing/recapitalization strategies (in the context of both distressed situations and acquisition financing for non-distressed assets); and
- Advising on M&A (both buyside and sellside) in the context of bankruptcy or distress.
Selected Capital Markets and Special Situations Transactions
Some examples of these diverse services include:
|
|
Aerospace, Defense, and Government (ADG) Services Industry Dynamics
Many defense and government contractors are currently experiencing limited to no adverse financial impacts associated with the current economic and public health crisis. Recent legislation, such as the Coronavirus Aid, Relief, and Economic Security (CARES) Act, has provided government agencies with the tools necessary to maintain their contracting workforces in a “ready state” via remote operation. Furthermore, prime contractor liquidity initiatives aimed at sustaining and providing flexibility to their supply chains have also supported the industry’s financial strength. Some ADG contractors have even experienced an extraordinary uptick in demand for their products and services which support the government’s response to the public health crisis, as highlighted in our recent transaction announcement for Airboss of America Corp.
However, some ADG companies are engaged in subsegments of the market which are more severely impacted by COVID-19 and may need to more aggressively consider alternative financing strategies relative to near-term creditor obligations and customer requirements. Companies more heavily impacted include those providing services that cannot always be delivered via remote means (e.g., facility inspections, call center operations, conferences, and stakeholder engagement) and those delivering products and services to severely impacted customers (e.g., airlines). Houlihan Lokey has worked with many ADG companies to implement bespoke financing solutions that address a wide range of needs that the current environment might present.
Please let us know if we can be a valued partner as you consider how best to navigate this period of business and economic uncertainty.
|
|
Contacts
|
Houlihan Lokey (NYSE:HLI) is a global investment bank with expertise in mergers and acquisitions, capital markets, financial restructuring, and valuation. The firm serves corporations, institutions, and governments worldwide with offices in the United States, Europe, the Middle East, and the Asia‑Pacific region. Independent advice and intellectual rigor are hallmarks of the firm’s commitment to client success across its advisory services. Houlihan Lokey is the No. 1 M&A advisor for the past five consecutive years in the U.S., the No. 1 global restructuring advisor for the past six consecutive years, and the No. 1 global M&A fairness opinion advisor over the past 20 years, all based on number of transactions and according to data provided by Refinitiv (formerly Thomson Reuters).
|
|
|
|
|
|
|
|
|
