Case Studies
J.S. Held Acquires Shechter & Everett to Expand Forensic Accounting Capabilities for Family Law Disputes in Florida
Read MoreThe Company was a privately-held operator of Nursing Home Facilities in Pennsylvania and Massachusetts with annual revenues of approximately $40 million.
The Company entered into a sale-leaseback transaction for the five nursing home facilities it owned and operated. Prior to and after the sale-leaseback transaction, the Company experienced State licensing issues with one of its facilities, resulting in a working capital drain. The following year, one of the Company’s other, more profitable nursing home facilities experienced issues with the State Department of Health, resulting in a temporary closure and a reduction in census from 95% historically to a low of 76%. The combination of these factors, coupled with substantial monthly rental obligations arising from the sale-leaseback transaction, led the Company to file a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code.
Our experts were engaged by the Official Committee of Unsecured Creditors of the Company (the “Committee”) to assist the Committee in reviewing and analyzing the Debtors’ ongoing business operations by facility. We assisted the Committee in gaining clarity into the Debtors’ operational, financial, and expense controls and provided an assessment of the Debtors’ organizational structure and the effectiveness of its management processes, which allowed the Committee to fully understand the possible outcomes of the case and how their constituents may be best served in recovering their balances owed. Further, we reviewed the owners’ historical and current compensation, including management fees, salaries, perks, and other and the appropriateness relative to the Company’s financial condition and the overall understanding of the Debtors’ short-term cash and liquidity requirements.
During the course of the case, our team developed a variety of scenarios to illustrate the cash flow maximum downside and to determine whether there was enough free cash flow to provide post-petition payments to the Committee without stretching payables, as had historically been the case. Lastly, we evaluated the Debtor’s Plan of Reorganization with existing management remaining as well as potential plans that would result in some or all of management being replaced and/or other strategic options, including a 363 sale of the business.
> Business / Operational Assessment
Most consulting firms approach a business assessment from a purely financial perspective — our assessments provide a 360° view of a business, addressing growth drivers, profitability, and uses of capital. Along with detailed financial performance reviews and cash flow forecasting, our comprehensive Business / Operational Assessment identifies the various challenges clients encounter throughout their operations.
> Turnaround and Restructuring Services
Navigating the many challenges confronting a company in transition requires an operationally focused approach that looks beyond the balance sheet to minimize further degradation and build a path to sustainable growth. Drawing upon decades of experience in the turnaround space, we help companies in transition identify practical strategies to improve profitability and liquidity for immediate relief, while concurrently developing and executing a comprehensive turnaround plan for long-term, sustainable value creation.
