Helping the Company Navigate a Challenging Path: Debt Restructuring Success Story
Introduction
In this article, we delve into the case of
a prominent glass manufacturer in Indonesia that faced significant challenges
due to a furnace failure and subsequent bankruptcy lawsuit (PKPU). Our firm was
appointed as the advisor to guide the company through the PKPU process, develop
a viable restructuring plan, rebuild creditor trust, and navigate complex
negotiations. Through our expertise and strategic approach, we not only secured
court approval for the Restructuring Scheme but also invited
an International new investor, ultimately increasing the company's value to
approximately USD 70 million. This article highlights the background, issues in
the glass manufacturing business, and the successful solutions implemented.
Background
Our client, one of Indonesia's three major
glass manufacturers with over 35 years of industry experience, encountered
difficulties meeting creditor expectations following the failure of a crucial
glass factory furnace. This led to a PKPU lawsuit, involving divergent
interests among the owners' family members. As the appointed advisor, our
responsibilities included developing the best restructuring plan, acting as a
liaison between the company and its creditors, facilitating negotiations,
managing unpredictable situations and the dynamics
within the family owners.
Understanding the Glass Manufacturing
Business
The glass manufacturing business heavily
relies on specific machinery and its capacity. Once lit, the machines operate
continuously for 24 hours a day over a span of ten years, followed by a
six-month overhaul period. After this, a major overhaul is required to replace
the entire machine. Given the capital-intensive nature of the industry, with
only a few major players, restructuring the business was vital to unlock its
significant potential.
The Solution
The Solution
Taking into account the intricate dynamics
of the PKPU process, we leveraged our knowledge and expertise to resolve the company's
challenges. Through meticulous business model analysis, we aimed to restore
creditor trust and demonstrate the long-term viability of the business. By
highlighting the capital-intensive nature of the local glass industry and the
scarcity of major players, we convinced the creditors that restructuring was a
sustainable solution.
One of the major challenges we faced was
managing the expectations of the three family
owners
and facilitating an agreement during the restructuring process. Through
skillful negotiation techniques and effective communication, we successfully
obtained court approval for the Restructuring Scheme, which we had meticulously
prepared and submitted. Our approach not only attracted a new investor who
aligned with the company's current condition but also increased the company's
value to approximately USD 70 million, despite the distress it faced.
Conclusion
Through our strategic guidance and
expertise, we helped the glass manufacturer navigate the challenging PKPU
process and develop a successful restructuring plan. By conducting a
comprehensive analysis, restoring creditor trust, and demonstrating the
company's long-term potential, we obtained court approval for the Restructuring
Scheme. Additionally, our efforts invited a new International investor who recognized the value and potential of the business,
resulting in a substantial increase in the company's value. This case showcases
our ability to drive successful debt restructuring and transform distressed
businesses into valuable assets.