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(Revised from original 2006 version)
Hexcel Turnaround -- 2001 (A)
Hexcel's new CEO is faced with deciding how to "take out" $60 million in cash costs in fiscal 2002, as two of the company's end markets--electronics and commercial aerospace--are expected to decline precipitously. Options include closing plants, exiting a business, or undertaking a major headcount reduction. Includes a description of Hexcel's private equity relationship with Goldman Sach's Capital Partners and presents the financial challenges of renegotiating bank lending covenants and managing maturing debt. Focuses on selecting a turnaround approach from the point of view of a general manager (the CEO).
Keywords: Private Equity;
Organizational Change and Adaptation;
Borrowing and Debt;
Marshall, Paul W., James Quinn, and Reed Martin. "Hexcel Turnaround -- 2001 (A)." Harvard Business School Case 806-099, January 2012. (Revised from original March 2006 version.)