Conway MacKenzie was engaged by a leading manufacturer, marketer and distributor of specialty plastic packaging solutions for the media industry for the primary purposes of performing a viability analysis of the business, as well as assisting management in the preparation of certain restructuring alternatives to be presented to the company’s senior secured lenders. Several internal and external factors led the company to a state of financial distress including:
- Significant turnover at the CEO level
- Non-competitive operational set-up on high volume commodity business
- Lack of focus on new product development which led to several new product failures
- Excessive capacity in marketplace and increased resin pricing
- Falling prices on high volume commodity business and weakening demand
Conway MacKenzie served as financial advisor during the liquidity crisis, including evaluation of short term cash generation alternatives and developing short-term cash flow and borrowing base projections.
Conway MacKenzie prepared a comprehensive restructuring plan, including plant rationalization/consolidation analysis, and SG&A rationalization plan; prepared a product profitability analysis; and assisted with marketing the company for sale. In addition, Conway MacKenzie assisted the company in obtaining a proper financial and operational structure that allowed the company the financial flexibility to implement its restructuring initiatives.
Conway MacKenzie was retained as turnaround advisor and investment banker to a 100+ year-old value-added paper merchant focusing on the conversion, warehousing and marketing of both job lot and perfect paper.
Conway MacKenzie’s work included assessing the company’s current operations and marketing strategy, management team, business plan and cost savings opportunities.
In eight weeks Conway MacKenzie accomplished cost and other improvements including closing certain facilities, reducing sales discount terms offered to customers, eliminating non-core business and realigning the management structure. Conway MacKenzie ran a marketing process that resulted in contracting 20 lenders and receiving proposals from seven parties. Given the competitive dynamics of this transaction, Conway MacKenzie was able to run two parties from seven parties. The process resulted in a final transaction that was a significant improvement over early indications of interest and closed 10 weeks from the beginning of the marketing process. With this improved operating performance and definitive business plan, the company, supported by Conway MacKenzie and Variant Capital Advisors, successfully raised $25 million in senior debt financing to replace the incumbent lenders.
Conway MacKenzie was retained as financial advisor to the financial lender in the Chapter 11 proceeding of a paper mill specializing in uncoated printing and packaging papers and processed chlorine-free (PCF) specialty offset papers for printers and converters. The company filed for Chapter 11 bankruptcy protection due to increased costs of raw materials compounded by a substantial drop in sales. Additionally, the company was faced with lack of payment by one of its larger customers.
Conway MacKenzie worked with management and helped the bank to review the company’s short-term cash forecasts and assessed liquidity constraints, to review the viability of claims against the company in the bankruptcy process and to assess the value of the company under various sale and/or liquidation scenarios.
The company exited Chapter 11 and was sold to a strategic buyer, thus satisfying the bank loan. The company continues to operate as a going concern.