Cloud 9fin Distressed Diaries — Cerba creditors' patience gets tested
Jun 19, 2025
Denitsa Stoyanova, a senior distressed credit analyst at 9fin, shares insights into Cerba, a French lab company facing severe financial turmoil. Cerba's debt has soared amidst government tariff cuts, with creditors now organizing for potential negotiations. The unexpected resignation of CEO Emmanuel Ligner adds to the drama, while net leverage ratios climb. Denitsa discusses critical cost-saving strategies, the impact of asset sales, and the urgency for Cerba to reduce its staggering debt from $4.8 billion to $2.7 billion for long-term viability.
AI Snips
Chapters
Transcript
Episode notes
Cost Savings Target Challenges
- Cerba aims to save 106 million euros in costs over two years, mostly through staff cuts and platform consolidation.
- Only 11 million was saved in Q1 2025, indicating they are behind schedule but plan to ramp up efforts.
Muted Asset Sale Strategy
- Cerba's recent divestments are limited; it sold its veterinary business for 70 million euros.
- The Italian Testing, Inspection, and Certification business may be next to sell, potentially fetching 115 million euros.
Financial Performance Squeeze
- Since the pandemic, Cerba's revenue and EBITDA have declined, squeezing margins from above 30% to around 22-23%.
- Increased costs and weak top line reduce cash flow, making it hard to cover high interest expenses.