Industry SectorsConsumer/RetailCase Study: Belron’s Treasury Evolution

Case Study: Belron’s Treasury Evolution

Belron Group is presently the world’s largest dedicated vehicle glass repair and replacement company. It is the owner of a number of brands that include Autoglass, Carglass and Safelite. Belron operates in more than 30 countries across five continents and under the maxim that if they can repair a windscreen, rather than replacing it, they will. 

Belron’s four-strong UK treasury team was confronted with two major projects for 2011, which were to implement a new IT2 Treasury Management System (TMS), and complete a refinancing that resulted in two tranches of new finance of €450m and US$250m respectively. Both projects were executed successfully, exceeding their base objectives in several ways. The IT2 implementation provided the group with a robust straight-through processing (STP) solution for all aspects of treasury operations, leading to the achievement of enterprise-wide cash visibility of about 95% plus efficiency and control improvements. 

The refinancing was transacted in the most difficult market conditions of last year against the backdrop of increasing concern regarding Greece, other eurozone members and the euro’s future, yet was completed at or above management expectations. The projects proceeded in parallel, requiring intense levels of focus and commitment. At the same time, the treasury team needed to ensure that the day-to-day functions of cash, treasury accounting and financial risk management were properly performed. 

The team’s successful execution has secured the basis for enhanced treasury operations, and yielded significant financial risk management benefits for the Belron organisation, including the securing of funding, counterparty exposure management and interest expense improvement.

TMS Implementation

The key IT2 implementation goals were to liberate staff to focus on their professional treasury duties, to provide a secure and transparent STP treasury workflow, and to enhance visibility of cash. 

The project was planned and managed by Belron’s treasury team and supported by a project manager and cover for the cash role. Its completion on schedule in October 2011 involved the integration of: 

  • MT940 bank statement import, via Fides Treasury Services.
  • Deal and funding requests from subsidiaries via IT2 NET.
  • Foreign exchange (FX) and money management (MM) dealing via 360T. 
  • Confirmation management, via Misys CMS. 
  • Market rates import from Reuters Datascope.
  • MT101 treasury payment export, to Fides. 

The integrated system solution manages Belron’s global network of 570 bank accounts with over 200 banks, reflecting the cash handling requirements of the group’s vehicle glass repair and replacement business. Manual balance input is used for non-SWIFT, and primarily US, banks. 

The team managed a high volume of bank paperwork, needing persistent additional effort to keep the project on track. Belron were early adopters of a new release of IT2, and the team managed the extra effort required for testing and commissioning patches and service packs to take full advantage of IT2’s treasury process management, analytical and reporting powers. The IT2 system is operated in a fully managed hosted environment. 

The end result is that Belron’s team now focuses on value-added functions. The daily cash process has been reduced by around one hour. Other STP processes including dealing and reporting are already saving between 15 and 20 hours a month, representing significant savings for a team of four individuals. Further improvements are anticipated as the team optimises processes.

The major financial gain for Belron is based on a striking 50% increase in global cash visibility, to about 95%. The positive effects include a potential increase of €15m to €20m in cash pooling balances from business units, which would have a continued interest cost benefit of at least €250,000-€300,000 per annum, enabling Belron to pay down debt this year. In addition, enhanced cash visibility has improved counterparty exposure management, enabling the group to reduce exposures to lower rated institutions and to avoid potential policy breaches. Current objectives in 2012 include cashflow forecasting including variance analysis, cash pool optimisation and automated IT2 ledger upload to Oracle Financials. 

Refinancing Project 

Balancing the need to refinance with the desire to maintain the economic benefits of a previous financing negotiated in 2007, more than 50% of Belron’s debt portfolio occurred at a time of stress and volatility in the capital markets, as the euro crisis intensified during 2011. 

In deteriorating conditions, Belron needed to execute a strategic campaign with the most demanding objective to secure a full refinancing that would reflect the company’s pricing and duration objectives. The exercise comprised a US dollar (USD) private placement programme plus the negotiation of a new multibank long term credit facility with Belron’s relationship banks.

The USD private placement, agented by RBS, involved a substantial investor relationship exercise to sell Belron’s unique credit to large US and UK insurance companies. This required delivering bespoke presentations to investors about Belron’s credit story, operational and financial management. The private placement financing process was driven by treasury, but supported by strong teamwork throughout Belron. The financing was complemented by improving credit status, with increased sales from €1.5bn in 2006 to almost €3bn in 2010; the Belron group understands that investors now view its credit as implied BBB to BBB+. 

The original funding target of US$150m was significantly oversubscribed, with approximately US$800m of bids from institutional investors. Belron increased the size of the transaction with an additional, unplanned tranche of US$100m, all at an excellent margin, generating a substantial benefit beyond the scope originally planned. The programme exceeded Belron management’s pricing objectives by 20 basis points, and achieved a maturity profile of seven to 12 years – an exceptional result. 

The bank refinancing was a very complex deal. The treasury team again demonstrated superb bank relationship management, and timed the deal correctly based on professional judgement of the difficult market and complex commercial situation. Belron executed on mutually satisfactory commercial terms, with an on-target maturity profile of five years and €450m. The transaction was executed with Belron’s long-term relationship banks; Bank of America Merrill Lynch (facility agent), BNP Paribas, Commerzbank, ING, Banque LBLux, KBC and RBS, delivering an excellent result for all parties. 


The Belron treasury team have shown exceptional levels of professionalism, strength and commitment throughout 2011, working together most effectively on diverse, high-priority projects. This effort has enabled Belron to secure its financing very cost-effectively, enhance cash visibility very strongly and reduce operational and counterparty exposure risk; all in a most difficult year for treasury, for finance and for business in general. The team’s 2011 efforts were recognised for performance substantially beyond expectations by Belron’s chief executive officer (CEO) Gary Lubner, and Lisa Stone was subsequently promoted to group treasurer. 

  • This case study is based upon an entry into the gtnews Awards for Global Corporate Treasury 2012, sponsored by Bank of America Merrill Lynch (BofA Merrill). The winners of this year’s annual awards, now in its third staging, were only revealed at a gala dinner on 24 May at the Sofitel Grand Hotel in Amsterdam, the Netherlands, after the opening of the two-day gtnews Forum for Global Corporate Treasury conference. This highly commended entry from the gtnews Awards 2012 is shared here from the Treasury Team of the Year category as a best practice guideline and commentary. To see a full report on all the Awards winners and the gala dinner on 24 May please click here





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