Case Studies: Turnaround & Restructuring Advisory

Real Estate Development

Peter Colmer was hired in 2010 by a prominent residential real estate developer whose lender was concerned about the pace of lot absorption at several large developments, which would ultimately impact the borrower's ability to service its outstanding debt obligations. The bank had indicated that it would cooperate with the developer and its partners to restructure and refinance the debt associated with the various developments, but that there would be a requirement for a comprehensive strategy as a precondition to any substantive changes. In a highly complex transaction involving land exchanges, refinancing, builder enhancements, tax considerations, and other matters, a settlement agreement was executed 13 months later. Mr. Colmer continues to work with the client on matters associated with financing strategies and development initiatives.

Distribution Company

Retained by a leading distribution company, Peter Colmer and Mark Smith, CFA, were retained to produce 13-week liquidation and cash flow projection models to objectively evaluate the merits of continued funding versus foreclosure. Following a thorough analysis of the company's liquidity and collateral positions, Mr. Colmer and Mr. Smith successfully negotiated an initial forbearance agreement with the secured lender. With the operating conditions established, an existing over-advance of the company's asset-based revolving credit facility was steadily reduced to an acceptable level, allowing for the development and execution of a long-term work-out plan.

One of the key highlights of the engagement was the disposition of a majority-owned "sister" group of four companies located in South Africa and Namibia, Africa. The cumbersome process involved Smith making two multi-week trips to Africa to coordinate on-site financial and legal diligence efforts for the purpose of producing marketing materials and to ascertain the proper transaction structure given the entity's presence in two countries. A third trip was made to assist a potential buyer with their diligence efforts.

Additional Experience

Peter Colmer and Mark Smith have been retained numerous times to develop short- and long-term business plans for the purpose of negotiating and executing credit agreements. Specific examples include work done on behalf of a $35 million North Carolina-based construction supply business, as well as a $40 million South Carolina-based plumbing and piping distribution business, as well as a $15 million Georgia-based service provider.