Schulte GmbH
Schulte GmbH, Germany's second largest national heating and sanitary distributor, with more than 2,200 employees and 100 branches, was unsuccessfully competing with "big-box" home improvement retailers. Schulte, which had been without a Chief Executive Officer since 2002, was grappling with declining market and business fundamentals, steadily slipping negative EBITDA, a lack of credibility with key lenders and credit insurers, and an unsustainable fixed cost structure. Serving in Chief Executive Officer / Chief Restructuring Officer and Chief Financial Officer roles, Alvarez & Marsal negotiated a 90-day moratorium with Schulte's lenders, identified the company's core business operations, and developed a restructuring plan. The A&M team significantly improved Schulte's net working capital, and successfully reduced debt from €119 to €62 million, allowing the company to remain solvent. As a result, A&M was able to sell some of Schulte's assets, enabling the company to reschedule principal payments on its debts within 120 days of restructuring plan approval. Within nine months, Schulte was ultimately sold to a distress investor, with lender recovery estimated at the top of an expected range.
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