Leading North American Marine Container Terminals
Zolfo Cooper has assisted three of the largest marine container terminal operators in North America, with combined revenue of over $1 billion. As a result of a cyclical downturn and significant leverage, each of the companies was facing a breach of financial covenants on its senior secured facilities, which ranged from $800 million to $1.9 billion.
Concurrent with lender negotiations, each company was also evaluating major initiatives, including acquiring a significant new concession lease at a high-volume location, a strategic terminal expansion project and the operational restructuring of a key location.
In each assignment, the first in June 2008, Zolfo Cooper was engaged to advise lenders about potential restructuring options, specifically:
Performing due diligence on various aspects of each of the companies, including: strategic and operational business plans, cost-benefit analysis of major initiatives, and assessment of cash flows.
Advising the respective lender groups on the current and short term liquidity needs and the potential structure of credit agreements of each of the marine container terminal operators.
Managing and structuring a complex transaction among 20+ international lenders and the domestic equity sponsor that would meet the requirements of various state government entities, all within critical, time-compressed deadlines.
Leading difficult communications among 30+ member international bank group, equity sponsors and company management Identifying and addressing key cross-border and international restructuring issues.
Zolfo Cooper successfully negotiated an amendment to a marine container terminal operator’s credit agreement, which materially increased its value, including an additional $100 million outside investment for facility expansion and early debt repayment; a new lease agreement to improve EBITDA, and a successful raising of $250 million capital for the new concession acquisition.
For another marine container terminal operator, Zolfo Cooper negotiated a restructuring in which the senior debt and the interest rate swap holders would receive a 100% return of principal, compared to less than 40% without a restructuring.