I'm not sure what you mean by "the start of this". AL was making annual profits of $10-$15 million on sales of around $200 million and essentially debt free when Air Liquide sold it off in 2016. The buyer, Montagu Private Equity, was the one that put AL into the hole by financing the entire purchase with loans that were held by AL.
Montagu grabbed a chunk of the loan money as fees, stripped off the easily sellable assets, and left AL to try to somehow make a go of it despite its large debt service obligations. It turns out they couldn't, especially after the pandemic kicked in. Montagu tried to sell it, but after no buyer could be found they basically dumped it on Barings, its largest creditor. This happened in 2023 and Barings has no doubt been trying to shed itself of AL ever since. They did manage to sell a few more pieces, but again no one was willing to buy the main company along with all of its debts. That's why Barings had AL turn itself over to the French bankruptcy court.
So where does that leave AL? Well it all depends on how much of those debts were discharged through the bankruptcy process. Head is a sophisticated buyer so I highly doubt they overpaid for the company, including the cost of any remaining debt obligations. This should give AL a fighting chance. It also bodes well that Head makes their money by making and selling stuff instead of playing financial games.
Montagu grabbed a chunk of the loan money as fees, stripped off the easily sellable assets, and left AL to try to somehow make a go of it despite its large debt service obligations. It turns out they couldn't, especially after the pandemic kicked in. Montagu tried to sell it, but after no buyer could be found they basically dumped it on Barings, its largest creditor. This happened in 2023 and Barings has no doubt been trying to shed itself of AL ever since. They did manage to sell a few more pieces, but again no one was willing to buy the main company along with all of its debts. That's why Barings had AL turn itself over to the French bankruptcy court.
So where does that leave AL? Well it all depends on how much of those debts were discharged through the bankruptcy process. Head is a sophisticated buyer so I highly doubt they overpaid for the company, including the cost of any remaining debt obligations. This should give AL a fighting chance. It also bodes well that Head makes their money by making and selling stuff instead of playing financial games.
