Restructuring Professionals Shape Standout Corporate Turnarounds

Oct 12, 2011, 17:23 ET from Turnaround Management Association

CHICAGO, Oct. 12, 2011 /PRNewswire-USNewswire/ -- The 2011 Turnaround of the Year Awards recognize 34 restructuring professionals who helped faltering businesses rebound to either stand on their own or be sold. The Turnaround Management Association spotlights their achievements in changing the fates of five businesses in the media, specialty chemicals, chemical laboratory, petrochemicals and elderly housing industries on October 26 during the 2011 TMA Annual Convention at the Hilton San Diego Bayfront.  The winners are:  

Mega Company: Ray Dombrowski, Alvarez & Marsal; Ralph Schipani, Alvarez & Marsal; M. Natasha Labovitz, Debevoise & Plimpton LLP, formerly of Kirkland & Ellis; Richard Cieri, Kirkland & Ellis LLP; Craig Bruens, Kirkland & Ellis LLP; Daniel Aronson, Lazard; and Sachin Lulla, Lazard

  • Chemtura Corp., a Middlebury, Conn.-based $3.8 billion specialty chemicals manufacturer, nearly reached its boiling point in 2009 when its debt load reached $370 million, working capital lagged by millions, and Environmental Protection Agency claims topped $1 billion. The restructuring team bolstered the company's cash position by renegotiating thousands of contracts, orchestrating legal settlements that saved millions of dollars, and recast operations to achieve better integration across services and corporate functions. Despite the credit crunch, the team secured debtor-in-possession financing at favorable terms that kept operations stable through bankruptcy and secured $1 billion in exit financing months before Chemtura emerged from bankruptcy in 2010.

Large Company: Clyde Hamstreet, CTP, Hamstreet & Associates; Shirley Dunn, CTP, Hamstreet & Associates; Mark Schmidt, Hamstreet & Associates; David L. Osias, Allen Matkins Leck Gamble Mallory & Natsis LLP; David Zaro, Allen Matkins Leck Gamble Mallory & Natsis LLP; Albert N. Kennedy, Tonkon Torp LLP; Kenneth D. Stephens, Tonkon Torp LLP; Greg Yates, Seyfarth Shaw LLP, formerly of Steptoe & Johnson LLP; Michael Grassmueck, The Grassmueck Group; Geoffrey B. Winkler, The Grassmueck Group; Joseph Karas, Moss Adams LLP; James Gaffney, Moss Adams LLP; Stephen English, Perkins Coie LLP, and Darryl Steinhause, Luce, Forward, Hamilton & Scripps LLP

  • Sunwest Management Inc., based in Salem, Ore., and once the fourth-largest elderly housing operator in the U.S., appeared destined for a bleak fate after credit markets seized up in 2008. Saddled with nearly $3 billion in debt, the company came under fire from lenders threatening foreclosure and putting locks on cash, from investors fearful that their equity would vanish, and from state and federal securities regulators. A multifaceted turnaround team improved cash management controls and operations, persuaded lenders to restructure $1 billion in debt, and adeptly handled a 2009 lawsuit from the Securities and Exchange Commission that placed the company under federal receivership. As operations and revenue improved, the company's assets drew interest from a joint venture led by the Blackstone Group and following Chapter 11 plan confirmation, the $1.3 billion transaction closed in 2010.

Mid-size Company: Kevin T. Shea, LM+Co; Martin Young, LM+Co; Aaron Kibbey, LM+Co; Helana Robbins, LM+Co; and Diana Lee, RBC Capital Markets, formerly of LM+Co

  • Young Broadcasting, Inc., a New York, N.Y.-based television station owner, saw its fortunes abruptly turn after its record-setting purchase of San Francisco's KRON-TV and subsequent failure to renew the station's affiliation agreement with NBC. As an independent station, KRON-TV underperformed financially and drained cash Young Broadcasting needed to pay $830 million in debt and invest in broadcast technology upgrades to keep other stations competitive. The restructuring team, engaged a month before a 2009 Chapter 11 filing, helped the company develop a plan that gave 100 percent of new equity to senior lenders and reinstated $75 million in senior secured debt.  Once the company emerged from bankruptcy in 2010, the team extracted nearly $2 million in savings by renegotiating contracts and strengthened the company's competitive position through new investments in broadcast technology.

Small Company: Terry J. Bartz, MorrisAnderson; Aaron G. Gillum, MorrisAnderson; Daniel F. Dooley, CTP, MorrisAnderson; and David Warfield, Thompson Coburn LLP

  • Analytics., Inc., a holding company for three independent chemical labs serving pharmaceutical and industrial concerns, backed a $25 million loan for a business that toppled into foreclosure. Appointed as federal receiver in 2010, the restructuring team instituted a series of operational improvements, including establishing procedures to share common work processes, improve cash management controls, and assure quality standards were consistently met, and EBITDA improved by 40 percent. The team shepherded the company to a $23 million acquisition by Evans Analytical Group, a global lab network in Sunnyvale, Calif., in March 2011.

International Company: Alan Tilley, Bryan Mansell & Tilley LLP; Carlos Gila, Gila & Co; David Bryan, Bryan Mansell & Tilley LLP; and Richard Tett, Freshfields Bruckhaus Deringer LLP

  • La Seda de Barcelona's grim future seemed certain after it was delisted from the Spanish stock exchange in 2009. The Barcelona-based petrochemicals company, a European leader in manufacture of plastic containers and PET resin for the beverage industry, owed more than euro 1 billion to a swath of Spanish and international senior lenders. The restructuring team instituted operational improvements around a core group of facilities, devised a euro 300 capital injection and restructured euro 600 million in senior debt using the novel technique of restructuring the debt under an English legal procedure called a scheme of arrangement.

The Chicago-based Turnaround Management Association, turnaround.org, has more than 9,000 members in 48 regional chapters worldwide who comprise a professional community of turnaround practitioners, attorneys, accountants, investors, lenders, venture capitalists, appraisers, liquidators, executive recruiters and consultants.

SOURCE Turnaround Management Association



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