Rehrig International, Inc.

Client Profile
Rehrig International, Inc. (‘Rehrig’ or the ‘Company’) is among the world’s largest manufacturers of plastic shopping carts. Founded in 1975, Rehrig developed the world’s first plastic shopping cart and has continued to develop and patent a wide variety of other injection-molded products. The Company manufactures out of a fully integrated, state-of-the-art, 317,000 square foot facility located in Richmond, Virginia.
Situation
Despite the Company’s strong presence within the shopping cart industry, Rehrig faced challenges that contributed to overall financial difficulties. In early 2006, two major customers that accounted for a significant portion of the Company’s FY2006 shopping cart sales volume, converted from plastic to wire carts. This created cash flow issues and precipitated a covenant default.
Solution
As a result of the company’s constrained liquidity, Rehrig retained the Investment Banking Group to explore its strategic alternatives which included raising additional growth capital and/or to facilitate potential merger and acquisition opportunities. Rehrig chose to pursue a merger with United Steel and Wire, Inc. In addition to advising the Company on the merger, the Investment Banking Group raised financing to consummate the transaction; the financing included a $11.0 million revolving credit facility, a $4.8 million secured term loan A and an $8.4 million term loan B.