The Italian PARTNERSHIP international Working closely with sister organization De Lage Lan den, Rabobank Milan Branch has mediated a major fac- toring deal for the Italian textile company, Olcese.This is one of the largest contracts ever signed by DLL and will involve all of the factor's international sub- sidiaries. But equally important for DLL is the fact that it proves just how partnership between the bank and the factor can generate creative solutions for clients. Milan's Paolo Oldani - the Olcese deal has been a real learning experience. 'As soon as we began looking at this par- ticular company, we realized we would need De Lage Landen's input in this deal,' says Paolo Oldani, the credit analyst who work- ed closely on the contract with his Milan- branch colleague Roland van Limburg Stirum and Gerrit Schipper of DLL's Turin office. 'It's so useful to have this kind of ex pertise within the organization because it means you can put together creative pack- ages that bring in more than traditional products.' The Olcese story is, in fact, almost a text- book example of how partnership can work within the organization. The initial introduction to the company had actually come from Rabobank in New York. 'We got a call from them in April asking if we would be interested in a restructuring deal for a large Italian textile firm,' he explains. 'They had been approached by the US mer- chant bank Donaldson, Lufkin and Jen- rette (DLJ), but couldn't come in because no American company was involved. We had worked with New York branch before on a similar restructuring package for another company. But that deal didn't materialize. So they thought we might be interested.' As soon as the Milan branch began examin- ing the company's requirements, they came up with the concept of a working-capital financing deal on a factoring basis. 'The ar- ranger was actually pushing for both the factoring facility and a five-year commit- ment on financing,' Oldani says. 'But from the start we preferred bringing in DLL.' Established in 1904, Olcese is a well-known and very reputable Italian firm which manu- factures premium and melange cotton yarns for fabrics used by top designers such as Ar- mani, Christian Dior and Calvin Klein. Last year, the company exported 40 percent of its production, but expects this figure to in- crease to 60 percent by 1998. Turnover in 1994 was ITL 251 billion. 'It's actually a great company,' says Oldani. 'The management is sound and they seem to be doing everything right in what can only be described as a very tough market in Europe. Both Henk Visser and DLL's Ton Toebosch met with Olcese's management and when the deal was finalized, Ton Toe bosch was shown around one of the The bank's full board of directors will be in Latin America from 12-27 January, 1996, visit- ing our operations in Argentina, Chile, Cura^ao and Brazil.The visit ties in neatly with the recent announcement that Raibo do Brasil has been granted special presidential permission to open a subsidiary.The announcement is particularly gratifying for the bank as the Brazilian constitution has prohibited the establishment of new foreign banks in the country. More in the December issue. company's seven very modern plants. I'd say they were impressed with what they saw. And I think Olcese was impressed with us.' The problem confronting the company was that its struggling parent had been using it to raise capital. 'As a result, in 1993, Olcese had extraordinary losses of some ITL 93 billion, which was higher than its net worth. So, according to Italian law, it had to be re- structured through a capital injection which DLJ had been asked to arrange. Besides ap- proaching UK institutional investors for capital reinforcement, DLJ were pushing for a medium-term commitment from us along with a factoring deal.' Olcese's numbers impressed the Credit Committee enough to gain approval for a total financing package of ITL 90 billion - half on a five-year commitment, and the other half in a factoring deal. 'In the end,' says Oldani, 'Olcese itself found a potential equity investor and is out of trouble for the present. But we think there is a good chance that they will come hack to us for the restruc turing of their banking indebtedness. So, we now have a situation where we will be work ing with the company through DLL in a way we thought was best anyway. And DLL will be funding the deal through our office.' Besides its work with Milan, DLL has had contacts with both the Sydney and New York offices on receivables financing pro grams. 'But these are still contacts,' says DLL's Schipper. 'The great thing about this particular partnership with the Milan branch is that it shows clearly that factoring can be a real strategie instrument both for cliënt and the bank. Eactors tend to have a bit of an image problem. But I think that once people realize just how useful our products can be when structuring finance, that image will change very quickly. We're really very, very pleased with this contract - hopefully, it will be the first of many between Rabobank offices around the world and DLL's European network.' M ITALIA Wtm Rabobank Milaan heeft voor De Lage Landen (DLL) één van de grootste factoring-contracten ooit weten binnen te halen. Het gaat om een ITL 45 miljard (NLG 45 miljoen) deal voor de Italiaanse textiel- groep Olcese die topgarens produceert voor ontwerpers als Armani, Christian Dior en Calvin Klein. Maar het belangrijkste van deze samenwerking is, dat het bewijst hoe nuttig factoringprodukten kunnen zijn bij het structureren van financiële dien sten.

Rabobank Bronnenarchief

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