PROBLEM RESOLUTION
Companies that are growing, entering new projects or joint ventures, acquiring companies or borrowing excessive
funds will often encounter some type of serious commercial or financial problem that requires prompt attention
and resolution. Examples of serious problems include:
- breaking the financial covenants of a corporate loan agreement, and having the
bank demand payment.
- disputes between joint venture partners over policies and/or distributions of funds.
- credit defaults for financial, character or criminal reasons.
William "Chip" Gehle has significant experience in problem resolution, workouts, turnarounds, litigation and
bankruptcy during his banking, corporate and consulting career. Examples include:
- Managing a troubled three way joint venture with Mexican and Brazilian partners to construct offshore platforms
for Pemex. The Mexican partner filed a fraudulent lawsuit against both other partners, never served papers, and
obtained default judgments worth $40 million. Because of close “on the ground” relationships, obtained notice of
the judgment just in time to file an injunction in Mexican court, before the judgment was executed against my
employer and the Brazilian joint venture partner. Ultimately, negotiated a settlement resulting in the satisfactory
completion of construction projects for Pemex, and in the recovery of $30 million.
- Managing the turnaround of a manufacturer of modular buildings used in remote and severe weather sites,
based in the Bahamas. Developed the strategy of financing new contracts on a project by project basis,
sweeping a pre-determined amount of the profit margin of each project until the debt was reduced to
acceptable levels. When confidence and reasonable debt levels were restored, normal lending was resumed
under a revolving credit agreement.
- Managing a $30 million syndicated loan to a Texas distributor of heavy equipment. The primary owner of the
business died during a recessionary period and left the business to his two sons. The sons resisted any
cutbacks in the business and the business rapidly lost 2/3 of its net worth. Led negotiations of the bank
syndicate with the borrower and convinced the borrower to adopt cost savings and working capital preservation
measures. Assisted the company in refinancing with the manufacturer's captive finance company..
- Managing a $20 million revolving credit facility for a Mexican contractor to Pemex. Although the company
performed very well, the lender wanted out, due to a change in corporate strategy. Convinced the lender to
work with the borrower through the completion of all existing contracts, and assisted the client in refinancing.
- Managing a $30 million syndicated loan to an Argentine oil and gas exploration company to build a
jack-up offshore drilling platform. When the company entered a dispute with the U.S. jack up contractor, work
stopped and the loan was in jeopardy. Convinced the bank syndicate to post a $14 million standby letter
of credit in favor of the contractor, that was payable in favor of the contractor if the client lost
arbitration with the contractor. Work resumed on the platform, and ultimately the client won the
arbitration decision. No payment was made under the standby letter of credit, the platform was
completed and employed, and the loan was ultimately repaid from oil production revenues.
Tel. (1) 832-878-4614, wgehle@internationaldiligence.com
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