Turnaround and funding strategy for a pioneer tissue paper manufacturer and global exporter in Egypt
Situation
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One of the leading tissue paper manufacturers faced financial setbacks amid the economic instability post the Egyptian revolution and the FX crises, which led to significant deficits and ultimately the shutdown of the paper mill
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The company needed a turnaround strategy and fresh capital injection to settle debt and restart operations
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Conducted an assessment of the global export markets, building perspectives on market trends, competition in local market, converted and unconverted, and demand dynamics and pricing, with focus on bulk sales and high growth markets/ countries
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Reviewed historical financial performance, analyzed cost structure, elements and drivers, revenue drivers, trends and customer base, working capital structure, accumulated debt, and investment requirements
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Assisted the management in developing a 3-year turnaround strategy and value creation based on re-operating the facility, growing export sales and introducing a new product line to regain the client’s leading market position
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Evaluated the attractiveness and operational feasibility of introducing a new waste-based recycled tissue paper, its sales potential and its associated cost savings
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Worked with the management to translating the strategy to a business plan with 5-year forecasts for local and export sales volumes and prices in light of market trends, competitive landscape, price/cost and ability to grow current and future customer base as well as direct and indirect costs based on forecasted volumes, inflation trends, labor requirements, planned organizational structure, marketing activities
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Worked with the management in the evaluation and restructuring of the accumulated debt
Contribution
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A 3-year turnaround strategy and value creation plan including new waste-based tissue paper products
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5-year financial forecasts for the proposed strategy
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Strategy was translated into an investment story to attract multiple individual and institutional investors (currently in process)