Case Studies

Chapter 11 Liquidation Turned into Successful Plan of Reorganization

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

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Home·Chapter 11 Liquidation Turned into Successful Plan of Reorganization

The Situation

$400 million milk producer in NY/NJ – subsidiary of Parmalat S.P.A. $100 million loan to Parmalat USA, with funds upstreamed to parent. 

  • The milk producer went into bankruptcy along with its European parent company.
  • The bank risked losing a significant portion of $100 million senior stake due to strong opposition from other lenders who preferred liquidation to an equity stake.
  • Our experts’ analysis uncovered various errors in the company’s forward-looking assumptions that would significantly impact and undermine the Bank’s position.
  • Potential UCC fraudulent conveyance allegations could significantly reduce the Bank’s payout below that of unsecured creditors.

How We Advised

  • The company sold or closed all non-core assets.
  • The new management team renegotiated contracts with major supermarkets.
  • Settlement negotiations with UCC resulted in fraudulent conveyance allegations being dropped, preserving the bank's senior position and providing a higher payout to unsecured creditors.
  • Other senior lenders bought into the reorganization plan instead of liquidation.
  • The company emerged from bankruptcy and is performing better than planned.
  • The bank is likely to have repaid its investment.

Key Contact

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

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