Macquarie was approached to review the architecture firm’s complex financial structure. The firm’s directors were uncomfortable that they had their personal property and spouses’ guarantees tied up with their business.
Macquarie’s challenge was to untie the personal property from the financial security and find alternative collateral for loans to enable the business to grow.
The Macquarie difference
Experience with similar professional services businesses, including other architecture firms, gave Macquarie a good understanding of the industry that helped when assessing the firm.
Macquarie looked at the firm’s projected cash flow, the forward order book and the work the firm had locked in. Macquarie also assessed the firm’s pitch book and the outlook for upcoming work in different areas.
To help the new client Macquarie needed to:
- simplify the firm’s financial structure
- restructure its funding model.
Macquarie put a financial value on the client’s future work and used the projected cash flow as security against the loans. This enabled the client to refinance and recapitalise. It also simplified the financial security structure by removing the directors’ and their families’ personal property as collateral.
The client continues to benefit from the assistance and accessibility of their relationship manager through:
- regular financial review meetings
- regular reviews of working capital needs
- ongoing business feedback.