333 Capital

Advisory role and sale of non-core business for Transpacific. 333 Capital acted as sole financial adviser and successfully sold the business at a competitive price, removing any associated operational risk for Transpacific.

Background

333 Capital was engaged by Transpacific Industries (\'TPI\') in relation to TBP, a road tar business, in mid 2012. Following a review, TBP was identified as a non-core business for TPI:

a legacy business, not aligned to TPIï¿½s core competencies in waste management
competitive disadvantage to competitors who are vertically integrated
large working capital position and anticipated future capex requirements.

Our role

It was recognised at the outset that the sale process would be difficult ï¿½ a limited pool of potential buyers and a tough funding environment. 333 Capital designed and successfully executed a sale process which took account of these challenges:

The management team (\'MBO Team\') was identified as the strongest potential purchaser. In addition, the MBO Team would not require environmental (or other) warranties.
333 Capitalï¿½s strategy was to concentrate on this party, with a latent threat to widen the sale process to other possible buyers.
333 Capital, on behalf of the MBO Team, also led financiers through due diligence, including structuring and financial modelling, which ultimately resulted in the securing of an attractive debt funding package and allowed the MBO Team to complete the transaction.

Result

TBP was successfully sold to the MBO Team at a price that fairly reflected the business value. In addition to cash consideration at completion, TPI also benefited from:

a large amount of working capital that has been freed up
no exposure to any future restructuring, environmental or capex liabilities
reduced distraction for TPI Management ï¿½ can concentrate on making improvements in the core waste management business.