Financière de l’Arve

Presentation of the company

Financière de l’Arve is the holding company created in 2004 to acquire Clarino Corbex Numérique (CCN) active in the machining and turning of turboparts parts and sub-assemblies in the hydraulic sector. Clarino Corbex Numérique (CCN), headed by Olivier Romano, has 133 employees and is based in Thyez (74). Owned by Hadler Investment Fund, CCN and Prae-Turbo were combined as Booster Precision Components (BPC) to create a vertically integrated group.

The group’s main activities are :

• CCN is specializing in manufacturing of parts for turbocompressor called hotside, or exhaust treatment before the turbine.
• PRAE-TURBO is specialized in the manufacture of parts for turbocompressor called coldside, that is the recovery of the gas coming from the hotside part is cooled by the turbine before injection in the intake circuit.

The company works with he largest prime contractors in the Automotive sector.

The group has 6 production sites and 19 sales sites in Germany, France, Slovakia, China and Mexico. Its head office is based in Schwanewede (Germany).

Project Description

The company wishes to borrow 2 100 000 € over 30 months to finance the acquisition of a building in Thyez, currently leased. The sale price is 2 500 000 €. The balance will be financed by the German group. Our loan will be guaranteed by the German parent company. This project will be realised in the next few months.

The amount offered on the platform is limited to 1 000 000 €, which is in line with the regulatory limits.

Like all projects presented to individual lenders on Lendix, it is co-financed with institutional investors, sophisticated investors and the management of Lendix, subscribers to the Lendix Fund.

Analyst’s Opinion

The borrower is the french holding company whose revenues are derived from services invoiced to its subsidiaries. The financial analysis was carried-out on consolidated financial statements, which reflect the group’s performance.

With a turnover of 140 762 000 € in 2017 and an experienced team, the group has a good track record combined with a strong operating margin.

Over the past years, the group performed a global reorganization of the business with relocation to Mexico and China (2 plants vs. 1) as well as the reduction in temporary staff. This redeployment plan has been fully supported by the current shareholder with massive cash injection. Even if the group is still generating losses, the profitability has been improving from 5,5% to 9,5% in 2017 which shows positive output from the restructuring plan.

The forecast is based on the performance 2018 of the group taking into account the rental savings on the Thyez building.

The group has a solid repayment capacity with a forecast FCCR (Fixed Charge Cover Ratio *) at 1,98 and an excellent financial structure, with a forecast net debt / ebitda ratio of 2,00 and a net debt / shareholder equity of 42% taking into account the subordinated shareholder loans.

The analysis of the project leads to a credit rating of B+ and a 4,25% annual interest rate.

Strong points

• Good historical performance based on diversified client base
• Solid repayment ability with a forecasted FCCR of 1,98
• Leading international group on Compressor wheels

Points of caution

• Dependent on the Automotive Market
• On going restructuring of CCN

*The multiple of FCCR at 1,98 means that the company has a safety margin of 98% relative to its ability to repay its credit maturities.

The expert opinion is given as an indication on the basis of the elements provided by the project holder and information from our databases (Scores & Decisions, Corporate Banking File). This opinion is only an element of reflection in the decision making of a lender to participate in the financing of a project.