FOCUS: Reorganization & Bankruptcy
Restructuring B2B Firm with No Succession Plan After Owner’s Death
The owner of this 30-year-old manufacturing business passed away, leaving the company to his two children. Although they had worked in the business, neither of them knew how to run the company, which was highly leveraged and on the verge of bankruptcy. Without a succession management plan in place, but committed to salvaging the business, the company turned to Golan Christie Taglia.
Golan Christie Taglia put together a team to work with the client on a day-to-day basis. The first order of business was to meet with all the professionals working with the company (accountants, bankers, etc.) to review each relationship. The team then worked on restructuring a variety of high-interest-rate loans, refinancing into a single loan secured by the company’s real estate assets. The next step was to obtain a line of credit with reasonable terms.
Golan Christie Taglia’s attorneys also counseled the company on how to re-price its products, institute employee policies and procedures and eliminate redundant corporate jobs. No lawsuits resulted from the layoffs, but Golan Christie Taglia helped settle an unrelated wrongful discrimination suit that had been filed by an employee who had been dismissed prior to the layoffs.
The financial restructuring brought immediate relief: expenses were dramatically reduced. The loan refinancing resulted in a substantial decrease in the interest payments. Today, the business is doing well. Revenues have significantly increased, and expenses are down.