Posts Tagged ‘capital management’

Significant Chicago Bridge & Iron Company N.V. Shareholder, Cohen Capital Management, Calls for Immediate Change in Failed Senior Leadership | Business Wire

BROOKLYN, N.Y.–(BUSINESS WIRE)–Cohen Capital Management (“Cohen Capital”), one of the largest investors

of Chicago Bridge & Iron Company N.V. (NYSE: CBI) (“CBI” or “the

Company”) with an almost 1% stake in the Company, today issued a letter

to CBI Chairman of the Board, L. Richard Flury, calling out CBI’s dismal

financial performance, utter lack of go-forward strategy, and

management’s overall disregard for acting in the best interests of

shareholders. In the letter, Cohen Capital suggests implementing

immediate changes to management, including the termination of presiding

President and CEO Philip K. Asherman, to effect real change for


A copy of the letter follows:

August 24, 2016

Mr. L. Richard Flury
Chicago Bridge & Iron Company

One CB&I Plaza
2103 Research Forest Drive

Woodlands, TX 77380

Dear Richard,

I am the principal and managing director of Cohen Capital Management, a

New York family office with investments in both public and private

equity. We hold almost one percent of the common stock of Chicago Bridge

& Iron Company N.V. (“CBI” or the “Company”). As one of the Company’s

largest shareholders, I must express my deep concerns about the dismal

performance and misguided direction of the Company. On multiple

occasions, my office and I have reached out to senior leadership in an

effort to engage constructively about the present plight and future of

this potentially great company. It appears that the leadership is

dodging me to try to avoid answering very serious shareholder concerns.

I have over twenty years of investment experience with extensive

interests in, among other things, the oil and gas sector and real estate

sector. Cohen Capital pursues long-term investment opportunities in

durable value creation, generally with a 5-10 year investment horizon.

As the leader of the organization, I focus on investments in companies

run by honest, able, and shareholder-friendly management teams who can

create long-term, sustainable value for its owners.

In my career, CBI is the only company where the alarming failures of

management and the Board have compelled me to approach the Board in this

manner. However, the consistent, appalling and dramatic mismanagement of

CBI that has fumbled along destroying shareholder value and shrouding

what should be a strong business has forced me to make my concerns


Absolutely Unacceptable Shareholder Returns

In the past two years, the Company stock price has melted down from a

high of $89.22 reached on April 04, 2014, to $31.91, as of yesterday,

August 23, 2016. In a period of less than two years, the Company has

destroyed over $6 billion in shareholder value. Furthermore, CBI’s total

shareholder returns under a decade of leadership with its President and

Chief Executive Officer, Mr. Phillip K. Asherman, have been an abysmal

17% while the S&P 500 has returned over 116% during the period – a

staggering difference of over 99%.

Clearly Incapable Management

As shareholders know too well, the Company made a regrettable deal to

acquire Shaw Group in 2012 for a reported enterprise value of $2.0

billion and a staggering 7.0x transaction multiple to Shaw’s fiscal 2012

adjusted EBITDA. The Company publicized to shareholders and the market

that the acquisition would give it access to new revenue lines,

additional customers and a broader revenue base. Instead, the

acquisition has been a complete and utter disaster that continues to

cost shareholders to this day.

After the Company’s acquisition of Shaw Group, the Company worked on two

nuclear projects for over three years, without ever being paid for its

work. In addition, the Company continued to tell its shareholders that

eventually it would receive a payout for all the money owed in arrears.

Facing a resulting cash crunch, the Company was forced to raise billions

of dollars in fresh capital through the debt markets to fund its

operations resulting from the billions in losses sustained from the

nuclear projects. Subsequent to that, and the loss of many billions of

dollars in cash flow, the Company decided to sell its nuclear operations

to Westinghouse at another multi-billion dollar loss, with the provision

that it would eliminate all future liability from these operations for

the Company.

However, the stunning mismanagement of this business continues to haunt

shareholders. Only recently did shareholders learn that Westinghouse is

challenging the premise of its deal with the Company and seeking an

additional two billion dollars. My efforts to understand this complex

and now clearly failed transaction with resulting litigation have been

consistently rebuffed. While I hope the Company can once and for all put

an end to this saga, I have no faith in management or its legal strategy

based on its consistent failed performance.

Appalling Lack of Accountability

Despite nearly a decade of squandering shareholder value on failed

transactions, a lack of strategy and blatant mismanagement there has

been no accountability at the highest levels of CBI.

The Company’s senior leadership has an obligation to take immediate

corrective action to remediate all of these significant issues plaguing

the Company. Indeed, since the Shaw Group acquisition and its ensuing

multi-billion dollar debacle, there has been not one senior leadership

change. It is clear that those fiduciaries charged with overseeing and

managing the Company have a tin ear to – or simply don’t care about –

the strongly held views of the shareholder base that accountability at

the senior management level is needed, and that a strategic vision and

accompanying concrete action plan for the future is needed.

For our Company to move forward on the right footing, we demand the

immediate termination of President and CEO Philip K. Asherman, under

whose leadership the wrong-headed acquisition and ensuing problems

occurred. He has lost the confidence of the core constituencies and,

frankly, has an abysmal track record that clearly justifies his removal.

As a result of Mr. Asherman’s abysmal leadership, CBI has underperformed

the market massively over the last 1, 5 and 10 years. During this time,

Mr. Asherman has sold millions in stock while the Company’s true owners,

the shareholders, have suffered. In the last week, he destroyed what

little credibility he had with shareholders by dumping his personal

stake while the stock traded near multi-year lows.

While markets rallied around the world, Mr. Asherman sold 468,600 of his

own shares last week between $32 and 34 per share. This is right near

CBI’s low share price of $31.30 for the year. After his latest sales, he

is now left with 328,050 shares according to a form 4 filed on August

18, 2016. Shareholders are left with no choice but to see he has no

confidence in the Company and that he believes the share price is headed

even lower.

With a highly qualified, proven leader at the helm, we are confident

that CBI can turn the corner and deliver on its inherent potential to

create shareholder value. It is time for the Board to vigorously tackle

the job at hand; listen to the concerns of shareholders and make the

significant change so desperately needed.

As a shareholder of CBI, I reserve my right to pursue whatever actions

are necessary, including a potential proxy fight to replace board

members and force this change if the Board is unwilling to act for its

shareholders. I sincerely hope that this action will prove unnecessary

in the coming weeks if positive, concrete steps to change the management

and trajectory of the Company are implemented immediately.


Daniel Cohen


Founded by Daniel Cohen in 1992, Cohen Capital Management, LLC provides

investment advisory services and invests capital on behalf of Cohen’s

family and a limited number of outside investors. The Company offers

investment advice, portfolio management, securities, and other financial

services. The firm manages money both in the United States and abroad

for private families and institutional investors. CCM employs a

research-intensive approach, based solely on rigorous corporate

fundamental analysis to determine undervalued companies and generate

above average returns for our clients over a five to ten year period.

Be the first to comment - What do you think?  Posted by - August 31, 2017 at 1:06 pm

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PAREXEL International Enters Definitive Agreement to Be Acquired by Pamplona Capital Management for $88.10 Per Share in Cash | Business Wire

BOSTON & NEW YORK–(BUSINESS WIRE)–PAREXEL International Corporation (NASDAQ: PRXL), a leading global

biopharmaceutical services provider, and Pamplona Capital Management,

LLP (Pamplona) today announced that they have entered into a definitive

agreement under which Pamplona will acquire all of the outstanding

shares of PAREXEL for $88.10 per share in cash in a transaction valued

at approximately $5.0 billion, including PAREXEL’s net debt.

The purchase price represents a 27.9% premium to PAREXEL’s unaffected

closing stock price on May 5, 2017, the last trading day prior to

published market speculation regarding a potential transaction involving

the Company; a 38.5% premium to the unaffected 30-day volume weighted

average closing share price of PAREXEL’s common stock ended May 5, 2017;

and a 23.3% premium to the Company’s undisturbed 52-week high.

“Today’s announcement is the culmination of a comprehensive review of

the opportunities available to the Company, including interest solicited

and received from multiple parties with the assistance of independent

financial and legal advisors. Having considered these opportunities, the

PAREXEL Board of Directors unanimously determined that this all-cash

transaction and the significant, certain value it provides is in the

best interest of PAREXEL shareholders, as well as our company,” said

Josef von Rickenbach, Chairman and Chief Executive Officer of PAREXEL.

“PAREXEL benefits from a strong operating foundation with expertise and

resources to support our clients in their clinical trials around the

world. However, as our results over the past year show, the market for

biopharmaceutical services is evolving. We believe the more flexible

corporate structure afforded by this transaction will better position us

to advance PAREXEL’s strategy in light of these realities and to shape

the Company to best capitalize on our exciting market opportunities.”

Mr. von Rickenbach continued, “Pamplona has significant experience in

the pharmaceutical and healthcare industries, and we are pleased to have

their support as we work to realize the long-term opportunity for

PAREXEL. This transaction and the meaningful value it delivers for our

shareholders is a testament to the 19,600 employees who help our clients

advance the development and commercialization of new medical therapies

worldwide, and we will remain focused on providing our clients with the

service and support that have long set PAREXEL apart.”

Jeremy Gelber, M.D., Partner at Pamplona, said, “We have great respect

for the global leadership that Josef and the talented employees at

PAREXEL have built. We are excited to partner with a company and a team

that have a strong track record in helping to successfully navigate the

complexities innate to the biopharmaceutical industry and bring new

therapies to market.”

The transaction is not subject to a financing condition. Bank of America

Merrill Lynch and J.P. Morgan Chase Bank, N.A. have provided committed

financing for the transaction.

The transaction is expected to close early in the fourth quarter of

2017, subject to the approval of a majority of PAREXEL shareholders and

the satisfaction of other customary closing conditions.

PAREXEL expects to hold a Special Meeting of Shareholders to consider

and vote on the proposed agreement with Pamplona as soon as practicable

after the mailing of the proxy statement to shareholders.

The PAREXEL Board of Directors unanimously approved the transaction and

intends to recommend that all PAREXEL shareholders vote to approve the

agreement with Pamplona.

Upon the completion of the transaction, PAREXEL will become a privately

held company and shares of PAREXEL’s common stock will no longer be

listed on any public market.

Goldman Sachs & Co. LLC is acting as financial advisor to PAREXEL, and

Goodwin Procter LLP is serving as legal counsel.

Perella Weinberg Partners LP is acting as financial advisor to Pamplona,

and Kirkland & Ellis LLP is serving as legal counsel.

About PAREXEL International

PAREXEL International Corporation is a leading global biopharmaceutical

services company, providing a broad range of expertise-based clinical

research, consulting, medical communications, and technology solutions

and services to the worldwide pharmaceutical, biotechnology and medical

device industries. Committed to providing solutions that expedite

time-to-market and peak-market penetration, PAREXEL has developed

significant expertise across the development and commercialization

continuum, from drug development and regulatory consulting to clinical

pharmacology, clinical trials management, and reimbursement. PAREXEL

Informatics provides advanced technology solutions, including medical

imaging, to facilitate the integrated clinical development and

regulatory information management process. Headquartered near Boston,

Massachusetts, PAREXEL has offices in 86 locations in 51 countries

around the world, and has approximately 19,600 employees. For more

information about PAREXEL International visit

PAREXEL and PAREXEL Informatics are trademarks or registered trademarks

of PAREXEL International Corporation or its affiliates. All other

trademarks are the property of their respective owners.

About Pamplona Capital Management

Pamplona Capital Management is a London, New York, and Boston-based

specialist investment manager established in 2005 that provides an

alternative investment platform across private equity, fund of hedge

funds, and single-manager hedge fund investments. Pamplona manages over

$10 billion in assets across a number of funds for a variety of clients

including public pension funds, international wealth managers,

multinational corporations, family offices, and funds of hedge funds.

Pamplona invests long-term capital across the capital structure of its

portfolio companies in both public and private market situations and has

been one of the most active private equity investors in healthcare in

recent years. Notable recent Pamplona healthcare investments include

nThrive, Formativ Health, Brighton Health Group, Alvogen, Spreemo,

PatientCo and Intralign. Please see

for further information.

Additional Information about the Proposed Transaction and Where to

Find It

PAREXEL plans to file with the U.S. Securities and Exchange Commission

(“SEC”) and furnish its shareholders with a proxy statement in

connection with the proposed transaction with Pamplona and security

holders of PAREXEL are urged to read the proxy statement and the other

relevant materials when they become available because such materials

will contain important information about PAREXEL, Pamplona and their

respective affiliates and the proposed transaction. The proxy statement

and other relevant materials (when they become available), and any and

all other documents filed by PAREXEL with the SEC, may be obtained free

of charge at the SEC’s website at

In addition, investors may obtain a free copy of PAREXEL’s filings from

PAREXEL’s website at

or by directing a request to: PAREXEL International Corporation, 195

West Street, Waltham, Massachusetts 02451, Attn: Ron Aldridge, Senior

Director of Investor Relations.





Participants in the Solicitation

PAREXEL and its directors and executive officers may be deemed to be

participants in the solicitation of proxies from the security holders of

PAREXEL in connection with the proposed transaction. Information about

those directors and executive officers of PAREXEL, including their

ownership of PAREXEL securities, is set forth in the proxy statement for

PAREXEL’s 2016 Annual Meeting of Stockholders, which was filed with the

SEC on October 26, 2016, as amended and supplemented by other PAREXEL

filings with the SEC. Investors and security holders may obtain

additional information regarding the direct and indirect interests of

PAREXEL and its directors and executive officers in the proposed

transaction by reading the proxy statement and other public filings

referred to above.

Forward-Looking Statements

This press release includes forward-looking statements within the

meaning of the Private Securities Litigation Reform Act of 1995. These

forward-looking statements include, but are not limited to, potential

opportunities to accelerate PAREXEL’s growth and enhance its delivery of

world-class solutions to its customers; PAREXEL’s position to capitalize

on an increased trend for outsourcing of pharmaceutical products and

services; the expected impact of this transaction on PAREXEL’s financial

and operating results and business, the operation and management of

PAREXEL after the acquisition, the anticipated funding for the

transaction, and the timing of the closing of the acquisition. The words

“anticipates”, “believes”, “expects”, “may”, “plans”, “predicts”,

“will”, “potential”, “goal” and similar expressions are intended to

identify forward-looking statements, although not all forward-looking

statements contain these identifying words. Readers should not place

undue reliance on these forward-looking statements. PAREXEL’s actual

results may differ materially from such forward-looking statements as a

result of numerous factors, some of which PAREXEL may not be able to

predict and may not be within PAREXEL’s control. Factors that could

cause such differences include, but are not limited to, (i) the risk

that the proposed merger may not be completed in a timely manner, or at

all, which may adversely affect PAREXEL’s business and the price of its

common stock, (ii) the failure to satisfy all of the closing conditions

of the proposed merger, including the adoption of the Merger Agreement

by PAREXEL’s stockholders and the receipt of certain governmental and

regulatory approvals in the U.S. and in foreign jurisdictions, (iii) the

occurrence of any event, change or other circumstance that could give

rise to the termination of the Merger Agreement, (iv) the effect of the

announcement or pendency of the proposed merger on PAREXEL’s business,

operating results, and relationships with customers, suppliers,

competitors and others, (v) risks that the proposed merger may disrupt

PAREXEL’s current plans and business operations, (vi) potential

difficulties retaining employees as a result of the proposed merger,

(vii) risks related to the diverting of management’s attention from

PAREXEL’s ongoing business operations, and (viii) the outcome of any

legal proceedings that may be instituted against PAREXEL related to the

Merger Agreement or the proposed merger. In addition, PAREXEL’s actual

performance and results may differ materially from those currently

anticipated due to a number of risks including, without limitation:

changes in customers’ spending and demand and the trends in

pharmaceutical companies’ outsourcing of research and development;

PAREXEL’s ability to provide quality and timely services and to compete

with other companies providing similar services; PAREXEL’s ability to

comply with strict government regulations of the drug, medical device

and biotechnology industry; PAREXEL’s ability to successfully integrate

past and future acquisitions, including the acquisitions of Health

Advances, LLC, ExecuPharm, Inc., and The Medical Affairs Company, LLC,

and to realize the expected benefits of each; a change in PAREXEL’s

relationships with its largest customers; PAREXEL’s ability to service

its indebtedness; PAREXEL’s ability to protect its technology and

proprietary information and the confidential information of its

customers; the loss, modification, or delay of contracts which would,

among other things, adversely impact the Company’s recognition of

revenue included in backlog; the Company’s dependence on certain

industries and clients; the risk of patent infringement and other

litigation; as well as those risks discussed in PAREXEL’s Annual Report

on Form 10-K for the year ended June 30, 2016 as filed with the

Securities and Exchange Commission (SEC) on September 9, 2016,

subsequent Quarterly Reports filed with the SEC and PAREXEL’s other SEC

filings. Numerous factors, including those noted above, may cause actual

results to differ materially from current expectations. PAREXEL

expressly disclaims any current intention or obligation to update any

forward-looking statement in this press release to reflect future events

or changes in facts affecting the forward-looking statements contained

in this press release.

Be the first to comment - What do you think?  Posted by admin - July 16, 2017 at 3:44 pm

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Forex International Trading Corp. Signs Joint Venture Agreement with Heffernan Capital Ltd. | Business Wire

NEW YORK–(BUSINESS WIRE)–Forex International Trading Corp. (the “Company”) (OTCBB:FXIT), today

announced a joint venture with Heffernan Capital Ltd. The purpose of the

joint venture is to promote the

site throughout Asia.

This Joint Venture is being tested for six months to determine the

market opportunity in the Asia market. While Singapore has represented a

strong market for the Triple 8 platforms, the Company has not focused

its marketing efforts in other countries in the region.

Forex International Trading has chosen Heffernan Capital Ltd. to partner

with to market in this region because of their strong reputation and web

presence in this region. In fact, one of Heffernan Capital’s websites

ranks 515 in South Korea on

which places it higher than,,


Forex International Trading CEO Darren Dunckel commented “I am excited

to partner with such well respected names in the financial services

industry.” Issaree Suwunnavid CEO of Heffernan Capital said, “Foreign

Exchange, Gold and Commodity Trading are extremely popular in Asia and

we will be building out multilingual services to capture that market.

The reach that the new web platforms provide should provide us with

exposure that will help us to execute our business plan in the Asian


The site

will continue to block traffic from the United States while the Company

continues to develop its strategy for the United States.

About Heffernan Capital Management

Heffernan Capital Management aims to become one of the world’s leading

asset management enterprises. It specializes in global investment

management, risk management and advisory services to institutional,

intermediary and individual investors around the world. Heffernan

Capital Management offers a range of solutions, from proprietary active

management approaches aimed at delivering true outperformance to

algorithmic indexing strategies designed to manage broad exposure to the

world’s capital markets. Heffernan Capital Management brings investment

solutions through a wide variety of product structures, including

individual and institutional separate accounts, mutual funds and other

pooled investment vehicles, and the industry-leading trading platform

Heffernan Capital Management Direct. The foundation of our business is

to deliver the best for our clients, every time.

Heffernan Capital Management combines specific market insights, global

reach and scale, proprietary technology, strong local knowledge and

ability to deliver performance in all market environments. Its goal is

always striving to achieve the best balance between risk and

opportunity. It is a global firm with our roots in the Emerging Markets

of Asia; that combines the benefits of worldwide reach with local

service and relationships.

About Forex International Trading Corp.

Headquartered in New York, NY, Forex International Trading Corp.

operates an offshore advanced online trading platform for Forex markets

to non U.S. residents. The Company focuses on providing individual and

institutional investors with a platform for buying and selling

currencies, precious metals and commodity futures. The company’s

platforms allow self-directed, broker-assisted, and managed accounts.

Through the platforms, customers have access to over 20 currencies and

bullion deliveries. The Foreign Currency Market (“Forex” or “FX”) is

created by the global exchange of currencies. According to the Bank for

International Settlements, the average daily turnover, or, volume in the

Global FX market in April 2010 was $4 Trillion compared to only $1.2

Trillion in 2001 (Wall Street Journal, Sept. 1, 2010). Historically,

access to the FX market was only available to governments, commercial

banks, corporations, and other large financial institutions. The Company

is now capitalizing on the growth of online currency trading through its

state of the art web-based trading platforms.

For more information, please visit:

Forward-Looking Statements: This press release contains

forward-looking statements, including expected industry patterns and

other financial and business results that involve known and unknown

risks, uncertainties and other factors that may cause our actual

results, levels of activity, performance or achievements to differ

materially from results expressed or implied by this press release. Such

risk factors include, among others, whether Forex International Trading

Corp. can successfully execute its operating plan; its ability to

integrate acquired companies and technology; its ability to retain key

employees; its ability to successfully combine product offerings and

customer acceptance of combined products; general market conditions; and

whether Forex International Trading Corp. can successfully develop new

products and the degree to which these gain market acceptance. Actual

results may differ materially from those contained in the

forward-looking statements in this press release. Forex International

Trading Corp. does not undertake any obligation to update or revise

forward-looking statements to reflect changed assumptions, the

occurrence of unanticipated events or changes to future operating


Be the first to comment - What do you think?  Posted by - July 3, 2017 at 10:07 pm

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Paycom to Participate in Stifel Technology, Internet & Media Conference | Business Wire

OKLAHOMA CITY–(BUSINESS WIRE)–Paycom Software, Inc. (NYSE:PAYC), a leading provider of comprehensive,

cloud-based human capital management software delivered as

Software-as-a-Service, today announced that the company will participate

in the following investor event:

  • Stifel Technology, Internet & Media Conference
    Date: June 5,

    Time: 8 a.m. Pacific time
    Location: The Fairmont Hotel

    in San Francisco, Calif.

A live webcast of the presentation will be available at under the “Events” tab. Presentations may include

forward-looking information. Webcast replays will be available for 90

days following the event.

About Paycom

As a leader in payroll and HR technology, Oklahoma City-based Paycom

redefines the human capital management industry by allowing companies to

effectively navigate a rapidly changing business environment. Its

cloud-based software is based on a core system of record maintained in a

single database for all human capital management functions, providing

the functionality that businesses need to manage the complete employment

lifecycle, from recruitment to retirement. Paycom has the ability to

serve businesses of all sizes and in every industry. As one of the

leading human capital management providers, Paycom serves clients in all

50 states from offices across the country.

Be the first to comment - What do you think?  Posted by admin - June 12, 2017 at 12:31 pm

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What Does Working Capital Requirement Mean?

There are four main financial requirements of a business, namely, working capital, fixed assets, marketing costs, and a contingency fund. The financial management for a business involves managing all these in an efficient manner. Working capital is the amount of money that a company has to carry on with its daily operations. To determine working capital requirement, let’s first learn how to calculate working capital.

Working Capital Calculation

A company has two kinds of assets namely fixed assets, such as property and machinery, and current assets. The current assets of a company are those which will be used up within a single fiscal year. They include cash in hand, cash at bank, accounts receivable, pre-paid expenses, inventory, and short term investments. Current liabilities are those which have to be settled in cash within the current fiscal year. They include all the accounts payable pertaining to goods and services, including short term loans payable within one year. Working capital is the difference between the current assets and the current liability. The mathematical formula for this is:

Working Capital = Current Assets – Current Liabilities

Working Capital Requirement

The net working capital requirement varies from company to company. And within the company itself, it may vary from month to month. It depends on two factors, namely, how much earnings a company has and what is the frequency of receiving those earnings. Secondly, what are the expenses that a company has and how frequently these payments have to be settled.

For determining how to calculate working capital requirement for a new investment, the business managers have to make forecasts of the earnings i.e. accounts receivable, inventory, as well as the expenses i.e., accounts payable. After the projections have been made, you have to compare the actual earning and expenses with the projections. Next, add the increase in accounts receivable and the increase in inventory, and subtract the accounts payable from this amount. The figure you then get will reflect the probable change in working capital, which can be used for the new investment. This change is also determined through the inflow and outflow of funds. So these two things should also be taken into consideration while calculating the working capital requirement. The mathematical formula for this is:

Working Capital Required = (Increase in accounts receivable + Increase in inventory + Cash inflows i.e., cash in bank, bank loan, other current assets) – (Increase in accounts payable + Cash outflows i.e., prepaid expenses, payment to suppliers, other current liabilities)

Working Capital Management

Working capital management is very important to ensure that the company has enough funds to carry on with its day-to-day operations, smoothly. A business should not have a very long cash conversion cycle. A cash conversion cycle measures the time period for which a firm will be deprived of funds, if it increases its investments as a part of its business growth strategies. For this, the company has to take certain measures such as reduce the credit period of the customers, negotiate with the suppliers, and increase its own credit period with them, maintaining the right level of inventory, which reduces the raw material costs and proper cash management which ensues that cash holding costs are reduced. If these measures are followed, the requirement automatically comes down.

There are a few other things to consider. If the current liabilities of a company are more than the current assets, it represents a working capital deficiency, and may sometimes lead to business debt. A deficit working capital has a negative impact on the company’s image, as it depicts that the company is facing problems in liquidity, and is not able to pay for its short-term costs. In such a scenario, the investors may back out on making any kind of investments in the company. Thus, financial planning, including working capital planning, is very essential to run a business efficiently.

Be the first to comment - What do you think?  Posted by admin - April 28, 2017 at 12:39 pm

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Working capital management: difficult, but rewarding.

From the perspective of the chief financial officer, the concept of working capital management is relatively straightforward: to ensure that the organization is able to fund the difference between short-term assets and short-term liabilities. In practice, though, working capital management has become the Achilles’ heel of scores of finance organizations, with many CFOs struggling to identify core working capital drivers and the appropriate level of working capital.

As a result, companies can be limited in their ability to weather unforeseen or adverse events and ensure that cash is readily available where it is needed, regardless of the circumstances. By understanding the role and drivers of working capital management and taking steps to reach the “right” levels of working capital, companies can minimize risk, effectively prepare for uncertainty and improve overall performance.

Theory vs. Practice

For most CFOs, the greatest challenge with respect to working capital management is the need to understand and influence factors that are out of their direct control, in order to obtain a complete picture of the company’s needs. The CFO’s span of control can be limited in terms of functional silos, though corporate finance may well have some powers of influence over operating units.


While organizations generally concentrate on the right processes, such as cash, payables and their supply chain, they are less likely to take into account various internal and external constraints that can dictate how effectively those processes are executed. For example, the legal and business environments can have a significant impact on performance. Similarly, internal considerations–such as organizational structure, shared systems, autonomous business units, multinational operations and even information technology–can impact working capital, creating barriers that can hinder a CFO’s ability to truly understand, and therefore manage, the company’s needs.

The human factor is another important consideration. If management is focused purely on top-line growth, insufficient attention may be applied to cash flow management and forecasting. A hard-line focus on year-end or quarter-end results can produce a flattering, but inaccurate, picture of working capital performance and lead to counter-productive behavior.

Consider the impact on working capital of a year-end sales push where production has been building up inventory (which may not be the appropriate inventory) to meet this artificial demand, and the quality of receivables deteriorates during the early part of the following year.

While there is no magical solution for effecting robust working capital management, there are a number of prerequisites for gaining control of the complex process.

Proper Forecasting

Proper cash flow forecasting is essential to successful working capital management. To do this effectively, organizations must take into account internal and external working capital drivers and consider the sensitivity of those drivers to changes in the business or market.

Various questions need to be asked: How will unforeseen events impact working capital requirements? What if a sudden market downturn or upturn occurs? What if the company loses a major customer? What happens if a major competitor takes a significant action to improve its market position? Since each of these could have a sizable impact on the business, organizations must assume that the only certainty will be uncertainty, and prepare accordingly.

In addition to assessing the cash flow impact of potential events, companies should consider the possibility of having to make additional working capital investments. That’s because events could affect non-operational cash requirements such as investments, credit ratings and the ability to service debt, as well as inventory, payables and receivables.

Companies must implement contingency plans that take a holistic view of the organization in the context of a variety of different challenging situations. This will help minimize the adverse effects of unforeseen events and provide financial flexibility in uncertain times by having working capital as a ready source of cash.

How can you manage uncertainty? The three fundamental approaches are: control it, predict it, react to it. The most successful approaches are based around one approach, but contain elements of all three. Market-leading companies, perhaps not surprisingly, are in the best position to manage uncertainty, often enjoying the ability to control supply, minimize inventory and apply payment pressure on customers.

Companies with less influence, however, must rely more heavily on a strategy of prediction. To properly prepare for events and improve or maintain performance during times of uncertainty, organizations must develop an objective, business-driven view of the role of working capital. Without real insight into true working capital drivers, a company may be able to produce a reasonably good consolidated forecast, but find that accuracy drops considerably when it comes to producing divisional, operating unit or even a product-line forecast.

The most effective programs for both improving working capital performance and forecasting are those that look beyond the local organization and consider the broader corporate environment. Corporate investment and financing arrangements, for example, may provide for cash to be delivered by one location, but utilized at others. Restrictions on the repatriation of cash, internal inefficiencies in moving cash, delays driven by banks and sometimes-inadequate access to information can make the process problematic.

Cash generated in one country, for example, many not have the same value to the organization as cash generated in another. As a result, companies must plan global working capital improvement initiatives in the context of the ultimate use for the cash, rather than simply managing local balance sheets.

Setting the Stage

Successfully improving working capital management requires a multipronged approach. Companies must seek granular detail to identify the underlying drivers of working capital. This requires separating perception from reality and pinpointing impediments to efficient cash flow, such as poor links between production and billing or clumsy treasury operations.

Companies must also adopt an entrepreneurial mindset. They must act quickly to drive change by combining operational and financial skills, and expand their thinking beyond the finance organization to gain a more complete view of overall operations. Rather than wait for the perfect solution, they must identify and implement strategies that result in quick wins, generating short-term cash to fund longer-term projects.

Having the right people in place can also make or break the effort. Companies need to identify individuals who can be responsible for setting targets and performance levels and be held accountable for delivering. These professionals should be encouraged to challenge the status quo and drive change, using cross-functional teams.

Finally–and this is where many projects fail–companies must remove emotion from the analysis process. All initiatives must be business-case driven, and projects without measurable results or those not contributing to overall goals should be abandoned. Companies must agree on success criteria, prioritize based on contributions to these criteria and continuously measure performance.

While working capital forecasting is critical to a company’s ability to make informed strategic business decisions, many CFOs struggle with the process because of a lack of control and real insight into the underlying drivers of their working capital needs. By empowering the entire organizations to understand the company’s true working capital needs, companies can successfully reduce their financial risk, prepare for uncertainty and create a ready cash reserve that will provide flexibility and security during difficult times.

Andrew Harris ( is a United Kingdom-based Senior Director with Alvarez & Marsal, a global professional services firm. He specializes in performance improvement and working capital initiatives at companies throughout Europe and the U.S.

Be the first to comment - What do you think?  Posted by admin - April 8, 2017 at 2:47 pm

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Bridgeway Capital Management Names Devin Benton as Director, Institutional Sales and Client Relations | Business Wire

HOUSTON–(BUSINESS WIRE)–Bridgeway Capital Management (Bridgeway), an independent, statistically

driven investment manager, announced today that Devin Benton has joined

the firm as Director, Institutional Sales and Client Relations.

In this new position for Bridgeway, Benton will develop relationships

with institutional clients such as public plans, foundations and

endowments, as well as the consultants who serve them. Bridgeway’s

recent success with institutional clients has come from a shared goal of

providing better outcomes for investors. Benton will help strengthen

these relationships by listening to the needs of institutional clients

and matching them with the discipline and expertise that Bridgeway


“We have seen how our investment philosophy resonates with the

institutional market, and we needed a special kind of person to help us

bring it to a wider set of investors,” says Tammira Philippe, President

of Bridgeway Capital Management. “We are delighted we found someone of

Devin’s caliber who believes in our evidence-based investment process,

shares our commitment to putting investors first, and also wants to make

a difference in the world.”

Benton comes to Bridgeway with more than 15 years’ experience in the

investment industry, with a strong focus on serving public and corporate

plan sponsors, foundations and endowments, and investment consultants.

Prior to entering financial services, Benton served as an officer in the

U.S. Army, achieving the rank of Captain. Leading teams comprised of

individuals from a wide range of cultures and backgrounds demonstrated

the value of diverse perspectives in building teams, working toward

common goals and achieving shared success. He believes those skills are

critical to successful outreach to a range of potential clients, from

the largest institutional investors to small municipal plans and family


Bridgeway’s unique corporate culture, which includes a pledge to donate

50% of profits to charitable organizations, also offered Benton a chance

to better align his private-sector career with his personal commitment

to serving others.

“I have yet to see another firm in the industry that offers Bridgeway’s

combination of world-class investment strategies and record of

delivering exceptional results, along with the values and principles

that our firm lives by every day,” says Benton. “I’m excited to be

working at a place that is committed to doing everything it can for

clients, while also serving our communities in incredibly impactful


Benton will report to Dick Graf, the head of Bridgeway’s Marketing and

Client Service team. He plans to spend much of his time on the road,

meeting with institutional investors and consultants to show how

Bridgeway’s expertise can help them meet their own fiduciary


About Bridgeway Capital Management

Bridgeway Capital Management, Inc., offers expertly designed investment

strategies, mutual funds and sub-advisory services to select

institutions and advisors. Bridgeway believes that a disciplined,

statistical process – grounded in academic theory and fundamental data –

drives success in long-term investing. Putting investors’ interests

first is a hallmark of the firm’s unique culture and core business

values of integrity, performance, efficiency and service. Committed to

community impact, Bridgeway donates 50% of its profits to non-profit and

charitable organizations. More information on Bridgeway is available at

Be the first to comment - What do you think?  Posted by admin - March 11, 2017 at 11:11 pm

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