Food Provider

SITUATION

A leading provider of frozen and fresh foods generated $90 million of annual revenue from four manufacturing plants located across the United States. Its product lines include items such as frozen and fresh sandwiches, burritos, pizzas and baked goods. Two private equity sponsors acquired the company in a leveraged buyout in early 1999. However, the company was experiencing profitability and liquidity problems, and lost credibility with its lenders.

CRP’S APPROACH

The company engaged CRP as its turnaround advisor with a primary charter to evaluate business operations, develop a comprehensive plan to return the company to profitability and to restructure the company’s balance sheet. After CRP’s initial three-week analysis and subsequent presentations to the board of directors and bank group, CRP was further engaged to pursue an out-of-court restructuring effort with the various key constituents. Additionally, CRP assumed the role of chief restructuring officer for the company and managed the overall financial function.

RESULTS

• An Amended Loan Agreement was signed with the bank group, which reduced debt amortization schedules and provided additional working capital to support turnaround actions and sales growth.
• An Amended Subordinated Loan Agreement was signed with the senior subordinated lender and the private equity sponsors -- providing additional credit support that resulted in sufficient liquidity for the company. CRP played a key role in securing these agreement changes and securing additional credit for the company.
• Throughout this process, CRP worked closely with the equity sponsors, as well as executive and operations management teams to streamline operations, rebuild a management team and provide key constituents with weekly operational and financial updates as the company was restored to operating efficiency.