Cataraqui Building Supplies Capital Restructuring Case

ICBC Finance Practice

Constraints - 3 Hour Time Limit, 10 Slides

Jul 2025

Rapid growth had strained working capital, forcing the company to rely on expensive trade credit and exposing the owner to significant personal guarantees. The work reframed the problem away from growth optimization and toward risk containment, liquidity protection, and family alignment. The recommendation emphasized restructuring working capital and financing in a way that reduced personal exposure while preserving operational flexibility, recognizing that financial prudence mattered more than maximizing short term expansion.

Cover page of a document titled 'Catarqui Building Supplies' addressed to Andrew McLean from Ivan and Edina.

Table summarizing an executive summary with sections for problem statement, recommendation, key stats, and results related to restructuring a company and a bank loan.

A company analysis chart comparing success factors, such as 20% annual sales growth and expanding market share, against problems like slow receivables and negative cash flow, with a summary note about adaptability.

A diagram of stakeholder analysis with a central circle labeled 'Key Stakeholders' surrounded by five other circles labeled 'Andrew', 'Andrew's Family', 'Suppliers', 'Bank', and 'Customers'. Each surrounding circle has associated descriptive text abo

A list of decision criteria including Financial Sustainability, Minimal Risk for Family, Supplier Considerations, Bank Considerations, and Minimal Company Dilution.

Flowchart titled 'Alternatives' with options stemming from 'Family Meeting,' including taking on the loan or not, and various strategies for restructuring, retainment, or financing.

Table listing financial assumptions including drivers such as sales growth, COGS growth, SG&A growth, inventory turns, accounts receivable, accounts payable, depreciation, and discount rate with respective comments.

Financial analysis report showing funding trade payables yields, loan utilization versus interest cost from 1989 to 1998. Includes a bar chart of total drawn on new loans and interest paid, along with a table of interest expense, coverage ratio, and

Table showing cash flow sensitivity analysis for supplier terms and receivables management, comparing 5-year FCFNP sensitivity with accounts receivable discounts over various days sales outstanding.

Flowchart diagram showing steps for restructuring a company, including a family meeting, restructuring the company, and restructuring a bank loan, with details on each step.

Risk management chart displaying three risks with probabilities and severities, and corresponding mitigation strategies.

A business plan table with sections for problem statement, recommendation, key stats, and results. Problem statement discusses how to sustain growth without strain on cash flow. Recommendation includes taking a new bank loan, restructuring the compan