NATURE OF ASSIGNMENT:
Primary: Company Services / Business Sale via 363 Process
Secondary: Company Services / Financial Advisor to Debtor
Primary Industry: Manufacturing & Processing
Company: A fully-integrated, multi-plant chicken processor with $200 million in annual revenues. It served all major distribution channels.
Situation: Due to a dramatic and unprecedented fall in market prices resulting from the widely-reported "bird-flu" situation, the company's financial strength was being consumed by operating losses of up to $1.2 million per week. Cessation of operations and liquidation appeared imminent. A liquidation of the business would have resulted in almost a total loss of value and several hundred jobs in a distressed employment market. To avert a worst case liquidation scenario, Sylvest needed to be sold quickly to a larger competitor with the financial strength to weather a very depressed market. Speed was of paramount importance.
Focus Scope: Focus Management Group was retained as Financial Advisor to assist the Company in managing all aspects of its bankruptcy case and lead its bankruptcy sale process in a timely manner.
Tasks Performed: Focus Management Group worked closely with management to complete the following:
- Strategic Planning: Focus obtained consensus from all stakeholders, including the Company's primary senior secured lender that the Company needed to be sold quickly to avoid a liquidation outcome.
- Financing Efforts: Focus led the effort to obtain DIP financing in an accelerated timeframe from its existing revolving-loan lender to fund operations until the Company could be sold.
- Maintaining Financial Integrity: Focus spearheaded actions to enable the Company to maintain the financial integrity of the business while operating within budgetary limitations of the DIP-imposed budget.
- Bankruptcy Planning & Execution: Focus prepared a comprehensive communication plan, which was successful in maintaining the support of customers, vendors and employees during the 363 sale process.
- Managed Sale Process on Expedited Timetable: Using our time-effective process, Focus managed all administrative aspects of the Chapter 11 filing on an accelerated basis.
Results:
- Successful Sale in a Timely Manner: The Company was sold to a leader in the chicken processing industry just 7 weeks after filing Chapter 11.
- Maintained Employment Levels: Importantly, approximately 800 Company employees maintained their employment.
- Maximized Recovery: Secured lenders maximized recovery of their loans.