Xerium Technologies (NYSE:XRM) has completed a full business transition over the last years. The intensive CapEx for the Chinese machine clothing plant, the re-alignment with market trends, and improved operating efficiency have created a more stable company with a vastly superior growth outlook. The thorn in the side and pebble in the shoe has been an inefficient and risky capital structure. With approximately 5x net-debt-to-EBITDA, the company has been unavailable to most risk-conscious investors.
Xerium has entered the phase where FCF will be rapidly deployed to reduce debt, but the management team, with high inside ownership, seems intent on releasing value sooner. On the 19th of March, Xerium released a filing titled: “Xerium Technologies Announces Review of Strategic Alternatives to Maximize Shareholder Value” which includes below paragraph:
