Selected Cases

Screw Machine Company – A company already in Chapter XI Bankruptcy sought both time to improve its management systems and sell the business. With the permission of the Court, a consulting program was initiated that created a viable settlement program for creditors, positioned the company for sale and consummated the transaction.

General Contractor – A general contractor found itself in deep trouble when hit by two adverse situations. The first was a market downturn for its region. The second, which occurred more than a year into the turnaround program, resulted from management changes at a key customer. In addition, the company had a significant obligation to the IRS for payroll taxes. The turnaround plan called for a negotiated settlement with the IRS, for the development of strong management controls (documentation and project management), for the elimination of all non-essential costs and for a focus on certain segments of the business that were still performing. The plan was initiated and worked well for nearly a year. Changes at a key customer (management and job-related) resulted in litigation with that customer. The owner closed the company and asked the turnaround consultant to forge a plan to save the family from bankruptcy. The turnaround consultant engaged counsel to continue litigation against the former customer, structured a deal with the IRS for payment of all trust fund monies and liquidated certain real estate holdings of the family. The IRS was paid, the real estate was liquidated in an orderly manner and the threat of personal bankruptcy was removed.

Screen Printing Company – The Company was in Chapter XI and had poor management controls and weak marketing. A program was developed, a proposal was offered to creditors and a long-term settlement was negotiated with the IRS. The company came out of Chapter XI and continued operations.

Telecommunications Company – the Company facing a significant downturn in business coupled with runaway operating expenses, significant bank debt and IRS payroll tax obligations, engaged a turnaround consultant to ask for help. The turnaround plan called for a structured settlement for general creditors to be paid over a four-year period, for a negotiated settlement with the IRS, for a forbearance agreement strategy with the bank and for significant cuts to operating expenses, including the termination of several key executives. Provision was also made to attempt to sell one of the company’s profit centers.

Structural Steel Fabricator – A death in the family propelled a young engineer into the presidency of the family business. Despite a strong willingness to work, he had no love for the business. The consultant helped strengthen the company’s strategic position by initiating planning and management controls, as well as a tight marketing plan. The company survived a general market downturn and its components were successfully sold either to competitors or other interested parties.

For more information about Advent’s Turnaround Services, call 1.800.726.7985.