Case Studies

Financial Advisor in Long-Term Liquidation

J.S. Held Acquires Shechter & Everett to Expand Forensic Accounting Capabilities for Family Law Disputes in Florida

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The Situation

Disability claim contingent litigation with $75 million in Revenue and $23 million in Debt. Private equity sponsor-owned.

  • $6 million plus loss for 2 years in a row
  • The Company filed for Chapter 11. Liquidation of the Company’s assets occurred as part of the confirmed Plan of Reorganization
  • The Company was in the business of advocating for individuals with disability claims before the Social Security Administration. The Company was acquired by a private equity sponsor, who put the Company on a growth path. However, this path led to significant monthly losses and an inability to generate sufficient working capital to service its Senior Secured Bank debt and its unsecured trade obligations. Following very difficult negotiations to resolve the situation, the Company decided to file a Chapter 11 bankruptcy proceeding to restructure its operations. The goal was to restructure and reorganize the business, positioning it to service its Senior Secured Debt and pay its creditors.

How We Advised

Our experts served as Financial Advisor to the Senior Secured Lenders, leading to the filing of the Chapter 11, during the pendency of the Bankruptcy, and during the post-confirmation wind-down.

  • Analyzed the Company’s operations and the Bank Group’s ability to recover its debt.
  • Advised the Bank Group and its attorneys on the Bank Group’s financial options and potential results.
  • Interfaced with the Company’s financial advisors to develop a Plan of Reorganization.
  • Following extremely difficult negotiations during Chapter 11, a Plan of Reorganization was agreed to that called for the Company to conduct an orderly liquidation of its assets outside of bankruptcy, but with the bankruptcy court retaining jurisdiction over the case. It was estimated that the liquidation would take over 4 years to complete, as claims resolution takes years, and that the Senior Secured Bank Group would have a deficiency of $5 million to $7 million on its debt at the end. During this 4-year period, the Company would service its over 40,000 disability cases, collect the resulting receivables, and not take on any new cases.
  • Worked with the Company’s financial advisors during the wind-down and advised the Senior Secured Lenders on issues such as budgets, analysis of asset sales, and the orderly wind-down of locations and personnel. A key issue was monitoring collections and costs to determine when costs would exceed collections, as well as determining the optimal timing for selling the remaining cases and accounts receivable to maximize the Senior Secured Bank Group's results.
  • The Senior Secured Bank Group recovered 100% of its $23 million debt, plus interest.  The wind-down was completed in under three years, compared to the original estimate of four years.

Key Contact

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

Related Practice Areas

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