Sam discusses treasury management in private equity versus public companies, drawing on experience at Woolworths and Birdseye. Private equity moves faster on refinancing and cash decisions, but the core work of managing liquidity and risk stays the same.
The facility was great. Unfortunately, the markets weren't, the high street was not. And you know, it became a casualty. It had. It also had a logistics arm called Entertainment UK at the time, which was applying games and the videos etc to Woolworths as well as other stores and the credit insurers as well at that time were also getting hit and running for the hills a little bit and all that put pressure on cash. So my, my real role at Woolworths was a site and sort of bedding down the new facility and how it operated and worked was cash management, it was cash forecasting, it was liquidity, it was. And it became more and more detailed as things got more and more difficult. And at that time, what I learned, I mean, I learned an awful lot from this experience, I have to say. Not something that you'd want to particularly repeat, but some things you just become a little bit more resilient and learn as a treasurer where your role and responsibility ends and where it starts and where it ends. And I think it's important to make the board aware of that and your boss, assist, CFO or whatever aware of that because you are propelled into a spotlight situation when everyone is fighting, when everyone wants cash. So it was a really interesting time and like I say, not, not something I want to repeat, but a good experience, really good experience. I had two months off where I was kind of recovering from Woolworths, if you like, went for an interview for Bird's Eye. So it's Birdseye, the frozen food group that everyone knows in the uk, Igloo Foods from Europe. And whilst it's private equity and everyone thinks of private equity as being a highly geared company, they did have lots of cash. And that was the one thing that I was sort of sighing a relief for. I was thinking, crikey, I'd like to work for an organization actually, you know, is able to use cash. So that was great. But having said that, it's private equity, a world of which I'd never been in before and, and it was again, really interesting. It's so dynamically different from a PLC organization is what I found anyway. And it took a little while for me to get used to the ways of working in private equity. It is different and it's different in terms of the decision making, in terms of the board makeup, in terms of the focus. You know, with a PLC company at sort of bottom line, with private equity, it's about ebitda, Mult multiples and cash. But, you know, you can make real differences within private equity. The decision Making is very quick. So yes, whilst focus was on cash, they did have cash and we did some several sort of refinancings, recapitalization, acquisition of the Fin Italy group as well. So there was lots going on within Treasury. You know, there's a lot of debt to manage in private equity. The treasurer is in a slightly different, has a slight different perspective. I think it's very much a case of you have to roll your sleeves up. There's no hiding under any rocks. Private equity run a very lean finance function. In fact, I know you know, quite a few private equity companies don't have treasurers, for example, because they have the CFO is accountable and of course the PE houses themselves are very finance orientated. So getting the sleeves rolled up and getting them to understand, well, what can you bring to the party, you know, what can you bring? Show them the risk that they have within the company. Are they hedging themselves outside or do they need your help in hedging or do they help need your help in the cash? Because cash is still key and the focus to them. So, you know, working capital management, finding liquidity solutions there. When it gets to the big refinancing and capitalization, you'll find that the PE house will bring in their people to help you. But you can get involved as much as you like. I talk about quick decisions. We did a floating rate note. We issued a floating rate note in the market. We'd never done it before. Within 30 days from start to finish, we had to get the prospectus, the information memorandum, prospectus out and everything from start to finish. I remember having a call and they'd actually bought the time forward rather than extended it for us. I mean it was crazy. It was, yeah, 30 days, within 30 days from start to finish is quite something. And we got there and it was an achievement and it was great. Sam.
