LEASE RENEGOTIATION & CAPITAL RAISE
Client Situation:
A PE-backed flatbed transportation and logistics company with $1.3B revenue and $50M annual capex budget for vehicles, desired to audit their existing lease relationships and reset go-forward standards.
Engagement Objectives:
• Audit and evaluate current leasing standards compared to market.
• Ensure existing leasing structures, terms, conditions, and pricing are at/better than current market.
• If unable to improve incumbent, identify competitive lease providers.
• Negotiate new lessor contract terms and pricing
• Make certain that lease lines of credit are in place to accommodate $50M annual capex spend.
• Streamlined methodology and processes.
• Ultimately, reduce overall lease financing costs from previous years.
Engagement Objectives:
• Working with multi-year incumbent lessor to modify and improve existing model to meet market standards.
• Identifying and securing alternate, transparent lease providers that can meet/exceed the newly developed leasing standard.
• Ensuring all Client Stakeholders had a voice in the process and were informed in real-time on progress.
Client Results
- Delivered highly competitive alternate lease lines of credit options ON TIME!
- Negotiated all-in interest rates that were >800 basis points lower than the incumbent lessor resulting in the following savings:
- >$900k Day 1
- >$3.4M Year 1
- $17.4M over lease lifecycle
- Co-created repeatable, efficient, lease administration process saving time and ensuring compliance for each future lease transaction.