• GAL through its operating subsidiaries known as Groupe CAT is an international vehicle logistics provider with the majority of its business dedicated to the provision of finished vehicle and parts logistics for Renault. It has operations throughout Europe as well as joint-ventures in Latin America

• The business has few operating assets of its own and is dependent on third party logistics providers for the physical transportation of the vehicles

Events leading to the transaction

• In 2001 GAL was sold by Renault for approximately €450 million to a consortium comprising Wallenius Wilhelmson Logistics (WWL), Autologic plc and TNT. The initial contract period ran for 7 years. The purchase price was ultimately part funded by the issuance of senior bank debt and a high-yield bond

• Business, pricing pressures and an increase in fuel costs resulted in poor profitability and an inability to service the group’s debt burden. In 2006 Renault announced its intention to place the finished vehicle contract with an alternative provider after March 2008 and in May 2006 GAL entered the Safeguard Procedure in France

• Following six months of failed discussions between the senior banks, bondholders, shareholders and Wallenius the senior banks appointed Close Brothers Corporate Finance to conduct a review of the situation and provide them with a solution

• Soon afterwards, Renault announced it had awarded Vehicle Services International (VSI) the new logistics contract from March 2008

• The senior banks were required to negotiate with VSI regarding how much VSI would be prepared to pay them to purchase GAL

Solution

• Close Brothers Corporate Finance performed due diligence on the company and identified a logistics expert to advice the banks on operational issues. This enabled the senior banks to understand their commercial leverage

• Working closely with the banks’ lawyers, Close Brothers Corporate Finance developed a contingency plan involving an insolvency of GAL and foreclosure on the Groupe CAT shares to enable a viable alternative course of action to be followed if no agreement with VSI could be reached

• Close Brothers Corporate Finance was primarily responsible for negotiations with VSI and Renault as well as communicating with the various court-appointed officials overseeing the process

• In July 2007 an agreement was reached between VSI, the senior banks, bondholders and GAL shareholders for VSI to purchase GAL, thereby avoiding the need for an insolvency process

• The agreement was subsequently blessed by the French Commercial Court in August 2007