Case Studies

Business Sale For $15 Million Using an ABC

J.S. Held Acquires GLI Advisors, Strengthening Our Construction Project Support Services in the Western US and Hawaii

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Home·Business Sale For $15 Million Using an ABC

The Situation

Catalog Distributor doing $150 million of sales. $25 million debt.

  • Company’s Montgomery Ward and Popular Club catalog businesses were primarily with sub-prime customers who required DMSI to provide credit, were slow pay, and whose ability to pay was affected by the recession
  • Company was losing money, and was unable to pay its vendors and bring in merchandise to fulfill orders
  • The secured lender was unwilling to continue to fund losses or fund new sub-prime receivables during a sale process

How We Advised

  • Our experts were hired by the Board of Directors as Assignee in an Assignment for the Benefit of Creditors (ABC) as a strategic move to push the sale process forward
  • The secured lender supported the ABC and financed the business during the sale period
  • We marketed the Company and conducted a public auction which was attended by 5 potential buyers, including strategic and financial buyers
  • At the auction, a strategic buyer purchased all of Company’s assets except for the Popular Club assets
  • The marketing process brought competing bidders to the table, and pushed the price to over $15 million, substantially higher than if the assets would have been sold piecemeal
  • The Popular Club assets were sold at a subsequent auction sale for $700,000
  • The majority of assets were sold in under 45 days, keeping the costs of the liquidation to a minimum compared to a Chapter 11

Key Contact

Dan F. Dooley, CTP
Senior Managing Director
Strategic Advisory Practice
+1 603 660 8952
[email protected]

Related Practice Areas

> Assignment for the Benefit of Creditors (ABC)
As Assignees, our financial and operational experts leverage extensive restructuring experience to liquidate assets and quickly maximize proceeds for creditors while mitigating liability and preserving jobs. Our team serves as the distressed business’s de facto CEO and CFO, taking control of operations; managing creditors, employees, and litigation; preparing for and executing the sale of business assets; and distributing proceeds to creditors pursuant to priority.

 

> Solutions for Distressed Situations
We deliver integrated solutions for distressed and insolvent businesses that maximize recovery, mitigate risk, and restore enterprise value. Our experts are retained to help distressed organizations stabilize operations, protect stakeholder interests, and execute turnaround strategies. We take an operationally-focused approach that looks beyond the balance sheet to minimize further degradation and build a path to sustainable growth.

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