Industries

Restaurant and Food Services Management and Restructuring

The restaurant and food services sector is a challenging industry. Higher food prices can lead to operating losses, as can the rising cost of leasing space. In this “soft” industry, many businesses compete for a shrinking customer base, especially during inflation. There are changing trends in eating out and other consumer preferences. Businesses are feeling the pressure to embrace new technologies and implement eco-friendly practices.

When a restaurant or food services company is underperforming, experiencing a loss of liquidity, or struggling with a merger or acquisition, it may need expert advice on the best path forward.

SierraConstellation Partners has worked closely with restaurant and food service companies. We offer expert management and financial advisory services to guide businesses through industry changes and challenging transitions towards greater profitability.

Restaurant and Food Services Interim Management

A principal executive may have suddenly left the company, or there may be disagreements among the current leadership that negatively affect operations and employee morale. The business might face a higher cost of goods, supply chain issues, or a loss in revenue or liquidity that the current executives are challenged with.

The company’s board or key lenders may retain SCP to fill a leadership gap and get the company back on track. SCP has guided many businesses through financial challenges. We offer interim CEO, CFO, COO, CRO, and general managerial services. Our experts in the food and restaurant industry offer hands-on management to assist companies in navigating mergers and acquisitions (M&A) transitions or addressing liquidity challenges. They create revenue strategies aimed at sustainable growth and ensure that teams have the resources they need. Our interim managers facilitate smooth leadership transitions.

Restaurant and Food Services Financial Restructuring

In the instance where a food or restaurant business has missed covenants or has a liquidity crisis, a lender or board member will often bring someone in to assess the situation and propose a solution. 

If your business is struggling to keep up with the competition, then it might be time for a financial restructuring in order to better assess your strengths and options.

SCP has worked with many food-related businesses under such circumstances. We don’t just offer sound financial advice. Our comprehensive and hands-on financial restructuring team works closely with your organization. We collaborate with executives on strategic initiatives, get buy-in from stakeholders, manage projects, restructure balance sheets, provide merger and acquisition support, help manage sales transactions, and more. We’re focused on maximizing return.

Restaurant and Food Services Turnaround Management

The company may be seeing a loss in revenue and profitability. The CFO may have suddenly left. Outdated business practices may be dragging down operations and adding to inefficiencies. Whatever the circumstances are, the business is underperforming and require expert guidance and strategic planning. 

SCP has a great deal of experience with underperforming restaurant and food businesses. We evaluate the organization’s operations and finances to develop a strategic plan that enhances profitability and guides the company in the right direction. As part of our hands-on daily management, we will develop a cash flow model to forecast liquidity, optimize collections and expenditures, improve financial reporting, re-establish communication and credibility with stakeholders, and align organizational plans with company goals.

Restaurant and Food Services Performance Improvement

Is your food or restaurant business having performance issues? Telltale signs include eroding earnings and margins, trouble meeting debt obligations, and lenders freezing lines of credit. The company might be in trouble with its vendors and unable to pay for products or make payroll. If the company remains solvent, seek management and financial guidance to optimize operations and enhance cash flow.

SCP’s food industry experts have worked with companies in this industry to evaluate business plans, determine short-term cash flow needs, and provide guidance and recommendations. Our team can negotiate agreements with lenders and develop a plan to help return the firm to profitability. We work with executives to find the best way forward and execute those plans.

Restaurant and Food Services Talent & Culture

A merger, acquisition, or loss of a key executive can be difficult to navigate for a food or restaurant business. Restructuring the company may involve a reduction in force, or a new product line may require additional staff to be brought in quickly.

Whatever the situation, a company’s most valuable resource is its people, who are motivated by a strong company culture. At SCP, we help organizations acquire and retain top talent for a powerful, purpose-built team. Our custom-tailored talent management services include organizational development, seamless leadership transitions, and strategic compensation planning. We offer robust talent intelligence, risk management, and HR compliance to set up businesses for long-term success.

Frequently Asked Questions

What challenges are restaurants and food services facing in today’s market environment?

Today’s most significant challenges are rising food prices, supply chain disruptions, labor shortages, changing consumer trends, economic headwinds, and technology integration. Other concerns include food safety regulations, sustainability initiatives, competition from popular delivery platforms, and customer retention.

What trends in the food service industry should small-to-medium-sized business owners be aware of?

Smaller companies should pay close attention to the public’s rising demand for plant-based foods and interest in local sourcing, sustainability, and transparency. Businesses should consider adopting online ordering, delivery services, and contactless payment methods.

When should a struggling company consider turnaround management?

Warning signs include reduced cash flow, declining profits, and missed financial projections. There may be strained relationships with lenders and investors, internal factors like a product failure, or external factors such as a supplier or vendor declaring bankruptcy.

SCP Delivers Financial Solutions to Food and Restaurant Businesses

At SierraConstellation Partners, our extensive experience with this sector makes us uniquely qualified to guide your food or restaurant business through any financial challenges. Our experts go beyond robust management and financial advice. We create long-term, sustainable solutions for continued growth—or we will help maximize company value for a successful sale to realize the greatest return and best outcome for stakeholders.

See how our team can help you identify the next steps needed to achieve lasting results.

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Case Studies

Restaurants & Food Services Industry Team Members

William White

Senior Director

Roger Gorog

Senior Director

Christian Sorensen

Senior Director

Timothy Bossidy

Managing Director

Philip Kaestle

Managing Director

Bob Riiska

Managing Director

Carl Moore

Managing Director

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William White

Senior Director

Los Angeles, CA

BiographyNotable AssignmentsMedia & Awards

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Industry Expertise

William White, a Senior Director at SierraConstellation Partners, has over 12 years of experience advising companies and creditor groups through complex transactions, including in- and out-of-court restructurings, distressed mergers and acquisitions, and challenging financings.

He has worked with clients across a variety of industries and executed transactions ranging in size from less than $100 million to over $20 billion. His industry experience includes apparel, automotive, consumer retail, manufacturing, distribution, infrastructure, technology and telecommunications.

Prior to joining SCP, Mr. White was a vice president in the restructuring group at Rothschild, Inc. in New York. He also worked as a financial analyst in the financial restructuring group at Houlihan Lokey and as a financial analyst in the corporate finance group at Ernst & Young.

Mr. White holds a bachelor’s degree in business administration from the University of Southern California and earned his MBA from New York University.

  • Served as interim manager of a designer, manufacturer and retailer of branded children’s apparel operating 82 stores and an e-commerce platform during its restructuring and sale of assets.
  • Advised a leading manufacturer of waste handling and recycling equipment in North America on the consensual out-of-court restructuring of $725 million in debt obligations.
  • Advised a leading global manufacturer of wire harnesses on its $325 million pre-packaged restructuring.
  • Advised a global Tier 1 automotive supplier during its Chapter 11 restructuring of approximately $22.2 billion of pre-petition liabilities.
  • Advised a Tier 2 industrial supplier on its $335 million pre-negotiated restructuring.

Media

Awards

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Roger Gorog

Senior Director

Los Angeles, CA

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Roger Gorog, a Senior Director at SierraConstellation Partners, provides operational and financial advisory services to underperforming companies and companies in transition. His experience includes in- and out-of-court restructurings, business cost rationalizations, operational turnarounds, interim management, and transaction advisory services. Roger has experience across a variety of industries including, Aerospace & Defense, Business Services, Construction, Consumer Products & Retail, Energy, Financial Services, Food & Agriculture, Healthcare, Manufacturing, Real Estate, and Transportation & Logistics.

Before joining SCP, Roger was a Director at Alvarez & Marsal in their Healthcare Group where he worked on several large bankruptcy cases and numerous out of court restructurings. Prior to A&M, Roger worked in public accounting at Deloitte & Touche where he worked on financial statement audits of various corporations, both public and private.

Roger received his bachelor’s degree in economics and accounting from Claremont McKenna College and his Master of Business Administration (MBA) from The Peter Drucker School of Management at Claremont Graduate University. He is licensed as a Certified Public Accountant (CPA, inactive) and a Certified Insolvency & Restructuring Advisor (CIRA). He is an active member of the Association of Insolvency & Restructuring Advisors (AIRA) and the American Institute of CPAs (AICPA).

  • Interim CFO to a food manufacturer facing serious operational issues after losing its largest customer. He successfully reduced operating expenses and cash burn while negotiating with major vendors and the Company’s lender to extend their runway.
  • Officer for a leading cancer research institute where he was responsible for all finance and accounting related activities during a Ch. 11 bankruptcy and associated sale.
  • Financial advisor to large retail chain facing serious liquidity and liability issues. Communicated with all constituents, negotiated landlord concessions, and managed cash while we prepared for bankruptcy filing and associated liquidation sales.
  • Served as a financial advisor to a national ambulance company through a prepacked Chapter 11 bankruptcy that reduced balance sheet obligations by $350 million.
  • Financial advisor to an oil and gas E&P company where we successfully sold assets to strategic buyers, providing needed liquidity to maintain go-forward operations and successfully repay lenders and creditors.
  • Lead a due diligence assessment of a target company for a private equity firm that led to a successful transaction of medical information services provider. After the acquisition, he was further retained to assist in developing the integration plan, including development of various strategic initiatives to improve overall financial performance.

Awards

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Christian Sorensen

Senior Director

Los Angeles, CA

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Industry Expertise

Christian Sorensen, a Senior Director at SierraConstellation Partners, provides operational and financial restructuring and advisory services to both underperforming companies and companies in transition. He has experience with in- and out-of-court restructurings, operational turnarounds/improvement, balance sheet restructurings, debt and equity capital raising, mergers and acquisitions, divestitures, and conducting financial modeling and forecasting.

Christian has experience in a variety of industry verticals, including: aerospace and defense; agriculture; automotive; business services; consumer; food and beverage; healthcare; gaming, lodging and leisure; industrial and manufacturing; media and entertainment; oil and gas; restaurants; retail; technology; and transportation and logistics.

Prior to joining SCP, Christian worked at Sun Capital Partners, an operationally-focused middle-market private equity firm that invests in companies that are operationally challenged, experiencing an industry or business transition, undergoing a corporate divestiture, or managing rapid growth, with over $9 billion of capital under management. At Sun Capital Partners, Christian focused on analyzing control equity investment and divestiture transactions, and actively worked with executive management teams to drive performance improvement of portfolio companies. Prior to Sun Capital Partners, Christian worked at the investment bank Imperial Capital, where he focused on restructuring, financing, and M&A transactions.

In 2019, Christian won the M&A Advisor’s Annual Turnaround Award for Restructuring of the Year of between $25-$50 million for his work with the Cranberry Growers Cooperative.

In 2021, Christian received the M&A Advisor’s Emerging Leader Award, which recognizes leading M&A, financial and turnaround professionals who have reached a significant level of success while still under the age of 40.

Christian holds an Honors Business Administration degree from the Richard Ivey School of Business at the University of Western Ontario, where he graduated with Distinction.

  • Financial advisor and part of team that served as Chief Restructuring Officer to cooperative of cranberry growers, which successfully implemented a Chapter 11 Plan of Reorganization. SCP's solutions identified and implemented operational changes to reduce costs by over 20% and improve production yields by over 10%, while providing secured lenders full recovery. The transaction also received a Turnaround Award by The M&A Advisor for restructuring of the year.
  • Financial advisor and part of team that served as Chief Restructuring Officer to agriculture and commodities company during its Chapter 11 bankruptcy restructuring. Executed an orderly sale of all inventory, monetized certain contract assets, and sold individual operating facilities via court-approved Section 363 asset sales to maximize recoveries.
  • Financial advisor to consumer packaging business with over $140 million of indebtedness following events of default. Developed and implemented cash management solution, identified operational changes to reduce working capital accounts and increase cash conversion, and provided strategic review of alternatives.
  • Financial advisor to diversified manufacturing company with prior year revenue of over $700 million, including developing plant idling plans and identifying and implementing operations changes to reduce quarterly cash burn by over $5.0 million, while achieving a successful refinancing.
  • Worked with leading global manufacturing company on key operational enhancement initiatives to generate over $30 million of EBITDA improvement, and sell non-core assets.
  • Led approximate $100 million acquisition of North American manufacturing company. Worked with executive management teams to identify cost savings and synergies across various departments to enhance EBITDA by approximately 50%.
  • Evaluated in- and out-of-court restructuring alternatives to maximize shareholder value for an aerospace company. Negotiated senior debt purchase, and subsequent stalking horse purchase agreement and credit bid in a Chapter 11 §363 asset sale.
  • Closed over $7.0 billion of restructuring, financing and M&A transactions.

Awards

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Timothy Bossidy

Managing Director

Miami, FL

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Tim Bossidy is a Managing Director at SierraConstellation Partners with a significant track record of financial and operational consulting services to companies in transition. His advisory experience extends across turnaround management, mergers and acquisitions, capital raising and conducting financial modeling and forecasting across a variety of industries including: cannabis, consumer/retail, agriculture, media/entertainment, oil and gas, healthcare tech and healthcare services.

Prior to joining SCP, Tim worked as an investment banker at Goldman Sachs. There he focused on mergers and acquisitions, alongside initial public offerings, other equity transactions and debt financing. Prior to Goldman Sachs, Tim worked as a credit analyst at The Travelers Companies, where he covered high yield and investment grade bonds across the oil and gas and municipal sectors.

In 2020, Tim received the M&A Advisor’s Emerging Leader Award, which recognizes leading M&A, financial and turnaround professionals who have reached a significant level of success while still under the age of 40.

Tim holds a bachelor’s degree in economics and English from the University of Notre Dame and an MBA from Kellogg School of Management. He is originally from Connecticut and currently splits time between Los Angeles and Miami.

  • Interim management, advisory and financial modeling services to a cannabis company to organize and re-build finance and accounting departments, forecast cash flows for retail and cultivation entities, implement financial controls and prepare company for a capital raise.
  • Financial advisory to a cannabis company to implement cash management tools, oversee significant cost improvements, improve working capital and borrowing base management and repair lender relationship through improved forecasting.
  • Interim CFO role as part of CRO team for $500mm+ discount retail chain with international supply chain. Constructed operating model and turnaround plan to spearhead successful 363 sale of 85 stores out of bankruptcy. Led finance department, including cash management, in addition to daily operations across departments and over 5,000 employees to ensure maximum stakeholder recovery.
  • Interim CFO role for $40mm+ women’s fashion company. Oversaw restructuring, lender negotiations and Company-wide cost-cutting efforts to drive Company from significant losses towards profitability. Also led process for PO financing and additional rescue financing to give Company operational runway through a sales process. Implemented forecasting model and improved budgeting and financial controls to repair lender relationship and guide Company and lender through over-advance situation. Helped hire full-time CFO to lead Company upon SCP exit.
  • Advisor to a healthcare services company where executed a successful sale to a financial sponsor. Worked with company management to structure a deal to work around potential overhanging liabilities and identify synergies across potential buyers. Led diligence and valuation efforts ahead of transaction close.
  • Advisor to a retail company in financing and executing a management-led take private transaction. Led diligence and financial modeling efforts.
  • Informal advisor to several start-ups and lenders within cannabis landscape.

Awards

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Philip Kaestle

Managing Director

Seattle, WA

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Industry Expertise

Philip Kaestle is a Managing Director at SierraConstellation Partners, where he provides financial and operational advisory services to companies in transition. He has experience with balance sheet restructurings, interim executive management, operational turnarounds, identifying strategic opportunities, debt and equity capital raising, mergers and acquisitions, financial modeling and forecasting. Philip has worked in a variety of industries, including aerospace, apparel, automotive, distribution, entertainment, food and beverage, healthcare, industrial services, manufacturing, marketing, media, real estate, restaurants, retail and software.

Philip has served in a variety of senior-level positions including Chief Restructuring Officer, Financial Advisor, Investment Banker, Interim Chief Financial Officer, Interim President and Liquidating Trustee to numerous middle-market companies and is particularly skilled at assisting clients through challenging situations.

Prior to joining SCP, Philip was an associate vice president in OneWest Bank’s Media and Entertainment Finance Group where he was responsible for structuring, underwriting and executing new senior debt transactions and recapitalizations for media and entertainment companies. He was also a senior financial analyst in OneWest Bank’s Commercial Real Estate Group, responsible for managing and liquidating non-performing real estate assets.

Before joining OneWest Bank, Philip was an associate at Arch Bay Capital, a Southern California-based real estate investment fund. He started his career as an investment banking analyst with Imperial Capital, LLC in Los Angeles.

In 2020, Philip received the M&A Advisor’s Emerging Leader Award, which recognizes leading M&A, financial and turnaround professionals who have reached a significant level of success while still under the age of 40. In 2022, Philip was named to the Turnaround Management Association Northwest Chapter Board of Directors.

Philip holds a Bachelor’s degree in Financial Economics from Claremont McKenna College and is one of the co-leaders of the Claremont McKenna College Seattle Alumni Chapter.

  • Chief Restructuring Officer to a producer and processor of dried fruits where significantly improved liquidity and profitability, sold non-strategic real estate to reduce leverage and conducted a competitive a refinancing process which resulted in full repayment to the senior lender despite ongoing litigation between the company and the same lender.
  • Liquidating Trustee and Chief Restructuring Officer to a distributor of alcoholic and non-alcoholic beverages where he raised senior debt through a refinancing of the company's credit facility, then sold the assets of the company through a competitive process and completed the wind down despite ongoing litigation between the two shareholders.
  • Interim President and Chief Financial Officer to a dental laboratory manufacturing company where he rebuilt management and finance teams and significantly reduced operating expenses through a series of strategic initiatives despite a volatile operating environment.
  • Chief Restructuring Officer to a clinical-stage biopharmaceutical company which filed for Chapter 11 as a lawsuit with a former co-development partner was coming to a head. SCP led a settlement negotiation to resolve the litigation and completed an orderly wind down of the business, which resulted in full repayment to the pre- and post-petition lenders.
  • Chief Restructuring Officer and Interim Chief Financial Officer to an ethnic grocery store chain. Key responsibilities included cost reductions, vendor relations and cash management. He implemented a $12 million restructuring within a three-month timeframe which stabilized the business and allowed for a sale and subsequent recapitalization.

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Bob Riiska

Managing Director

Los Angeles, CA

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Industry Expertise

Robert O. Riiska, a Managing Director at SierraConstellation Partners, has over 25 years of turnaround and advisory experience, including serving in interim senior management capacities for clients and performing numerous value-added consulting assignments. Clients have included multigenerational family businesses, sponsor-backed roll-ups and large publicly traded corporations.

Mr. Riiska is a Certified Turnaround Professional (CTP), Certified Public Accountant (CPA) and Chartered Global Management Accountant (CGMA). He received a Bachelor of Science Degree in Economics from the Wharton School of the University of Pennsylvania, and an M.B.A. in Finance and Marketing from the University of Chicago Booth School of Business.

Mr. Riiska serves on the boards of several leading industry associations including the Executive Committee of the Turnaround Management Association’s Southern California Chapter, the Advisory Board of the American Bankruptcy Institute’s Bankruptcy Battleground West and as a Secured Finance Network member director.

In 2019, Mr. Riiska received the Turnaround Atlas Award for his work as Chief Restructuring Officer of LORAC Cosmetics prior to joining SCP in 2018.

Mr. Riiska’s recent engagements have been in diverse industries, including automotive dealerships, transportation, furniture manufacturing and retailers, apparel, mining, cryptocurrency lending, nonprofits, consumer products, restaurants and industrials.

  • Served as CRO of a gold mine located in the Southwest U.S., spearheading out-of-court restructuring efforts which led to a successful sale.
  • Served as financial advisor to a manufacturer and distributor of commercial office furniture, negotiating a forbearance agreement which would give the company sufficient operational runway to recover from the issues mainly caused by the pandemic.
  • As CRO of a prestige cosmetics company based in Los Angeles, oversaw all aspects of day-to-day operations, including directly interfacing with large national retailers and suppliers, and developing and executing liquidation strategies for excess inventory, while also coordinating successful sale efforts.
  • As financial advisor to a consumer packaging company, negotiated a new financing solution to provide liquidity to maintain core operations and pursue growth initiatives, while also achieving a successful sale of one of the divisions in an expedited timeframe.
  • As financial advisor to a $500 million long-haul trucking company, developed a successful turnaround plan and convinced the lenders to provide a significant structured loan overadvance to facilitate execution of the plan.
  • Served as financial advisor to a $300 million family-owned grocery wholesaler and developed a comprehensive turnaround plan to return the business to profitability.
  • Served as CRO of a $900 million publicly-traded staffing company with over 30,000 temporary employees. Successfully sold several business units after a massive tax fraud related to an affiliated company had been discovered.
  • Acted as Financial Advisor to one of the largest manufacturers of recreational vehicles while it operated in Chapter 11, leading to a successful asset sale.

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Awards

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Carl Moore

Managing Director

Dallas, TX

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Industry Expertise

Carl Moore, Managing Director and Head of the Dallas region at SierraConstellation Partners, has over 20 years of experience in distressed investing, private equity portfolio management, and the provision of advisory services to underperforming companies and companies in transition.

Prior to joining SCP, Carl had a 15-year career in the private equity, distressed investment and restructuring groups at Highland Capital Management in Dallas. Most recently, Carl served as the Co-Head of Highland’s Private Equity group managing a portfolio of 7 industrial and healthcare companies with a collective enterprise value of $700M. During and after the financial crisis, Carl co-managed a team of legal and investment professionals that led credit restructuring, amendment and related negotiations for the firm’s $25B+ leveraged loan and high-yield bond portfolio.

Prior to joining Highland, Carl practiced law as an associate with the law firms Brobeck, Phleger and Harrison and Looper, Reed & McGraw with a focus on financing and M&A transactions.

Carl graduated from the University of Texas at Austin with a BA in the Plan II Honors Program and a BBA in Finance, and then received a JD from the University of Houston Law Center. He is a member of the State Bar of Texas, and was licensed as a Certified Public Accountant (currently inactive).

  • Served as CRO of GDC Technics, a Fort Worth aerospace company focused on complex interior modifications and connectivity solutions for wide-body aircraft. SCP helped the client navigate a contentious bankruptcy process during which it completed an expedited transition into two new lines of business, settled a major lawsuit with a former contract counterparty, and sourced exit financing from a sponsor-backed customer that supported its post-emergence business plan.
  • Served as Interim Management for a Dallas-based distributor of fuel and lubricants. The client faced significant pressure from fluctuating commodity prices, customer concentration in oilfield service clients, and a thinly-staffed central management team. SCP improved reporting and internal controls, led communications and negotiations with the client’s main vendor and asset-based lender, and assisted the sourcing and onboarding of a permanent CFO.
  • Served on a SCP team that was the CRO for a Silicon Valley-based digital medicine company. In addition to customary bankruptcy-related matters, oversaw an extensive IP sale and technology transfer process to a former strategic partner.
  • Served as Chairman of the Board of a major chauffeured transportation portfolio company. Took an operational role in efforts related to the transition from an independent operator to employee business model and related litigation in several jurisdictions, as well as a comprehensive strategic and SG&A overhaul resulting in significant EBITDA improvement.
  • Served as Board member and worked with investment professionals and portfolio company management team to prepare a healthcare DME company for sale under an expedited time frame and intensely competitive industry environment. Managed multi-party negotiations with the Seller’s stakeholder group and a foreign strategic buyer. The sale resulted in significant value realization in the face of rapidly deteriorating subsector dynamics.
  • As Chairman of a development stage medical device company, led team that overhauled the finance function as well as provided operational guidance for its commercialization efforts. Led negotiation for distribution agreement with, and ultimate sale to, a major medical device company.

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Upscale Affordable Dining Chain

Situation

  • Publicly-traded $400 million upscale affordable dining chain with over 110 locations had struggled to remain solvent considering industry softness, operating losses, employee wage lawsuits and distraction caused by activist investors.
  • As a result, it breached its loan covenants and had very tight liquidity.

SCP'S SOLUTION

  • SCP conducted a detailed evaluation of the company’s business plan, including planned location openings, closures, capital expenditure requirements and individual location performance.
  • SCP identified short-term cash flow needs and recommended strategies for mitigating the projected shortfall.
  • SCP provided recommendations and guidance to the lender group over several months, enabling the continued extension of credit.

Results

  • The lender group provided sufficient runway for the company to evaluate various strategic alternatives.
  • Ultimately, the public company was taken private in a $100 million transaction, with stockholders receiving a 37% premium.
  • Almost all locations remained open, employees were retained, and trade payables were assumed.
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Slaughter & Processing Company

Situation

  • A $250 million beef slaughter and processing company headquartered in Colorado opened a state-of-the-art facility in Kansas in August 2001 which was designed to be capable of harvesting 1,625 animals per day was ordered into a Chapter 11 bankruptcy reorganization by the following March.
  • The plant was designed specifically for a single customer, Safeway, which barred FBO from selling to customers who competed with the grocery store giant. The Company also planned to eventually exert influence on the genetic selection of the cattle it processed.
  • Near the one-year anniversary of its Chapter 11, an SCP professional was engaged to advise the debtor on alternatives to liquidation.

SCP'S SOLUTION

  • The SCP professional reviewed processing, rendering, specialty meats, and cooked & marinated products and after-market segments (pet treats and blue chrome hides [partial tanning]) segments to make a determination of the segment’s viability, including testing marketing assumptions.
  • Reviewed product costs and related financial reports and analyses.
  • Provided Chapter 11 operational and wind down advice to existing production management.

Results

  • Future Beef was incapable of sustaining viable operations. The SCP professional assisted in the planning and implementation of a cost-effective plant closure that included processing cattle on-site prior to case conversion.
  • The SCP professional conducted talks and negotiations related to the sale of the business and brand.
  • Case converted to Chapter 7 on August 16th, coinciding with plant closure.
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Foodservice Packaging Company

Situation

  • One of the largest foodservice packaging companies in North America had eroding margins and earnings, resulting in difficulty servicing its debt. The company manufactured a broad range of single-use containers, tableware, cutlery, straws and meal kits.
  • After the company defaulted on certain financial covenants, the lenders froze the revolving line of credit.

SCP'S SOLUTION

  • SCP evaluated the company’s business plan, including operational improvement plans, business unit sales and capital expenditure requirements.
  • SCP validated short-term cash flow needs, financial performance and other key initiatives.
  • SCP provided recommendations and guidance to stakeholders, enabling the continued extension of credit.

Results

  • The company and lenders entered into two waiver agreements which provided sufficient time for the company to implement operational improvements.
  • Ultimately, the company was successfully refinanced and financial and operational performance dramatically improved.
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Confidential Supermarket Chain

Situation

  • A $1.2 Billion, New Jersey based supermarket chain had previously reorganized in Chapter 11 twice and found itself in yet another liquidity crisis, in part due to management fraud.
  • Further, having begun construction on new stores, the Company also found itself at the point of having to rationalize its footprint due to big-box competition while attempting to manage losses.
  • At the point of our engagement, the Company had previously run a sale process to sell the business as a going concern, which did not provide a conclusive result. Pressured by its lenders, the Board determined to enter Chapter 11 and attempt to find buyers for parts of the business rather than all of the business. SCP professionals were retained to prepare the company for filing and run the sale process.

SCP'S SOLUTION

  • SCP prepared the Company and the selected investment bank for a Chapter 11 filing on a very expedited basis.
  • SCP guided senior management on much of the day-to-day decision-making associated with entry into the Chapter 11 process, public and employee communication, vendor issues, cash issues, bankruptcy reporting preparation, etc.
  • SCP supported the management team as well as the investment banking team in preparing for the sale of the various parts of the business that were conveyed to new buyers as part of the bankruptcy process. A wind down of the business was anticipated.

Results

  • As buyers for parts of the assets of the business were identified, SCP managed the transition of those transactions. C&S Wholesale Grocery was the single largest purchaser of assets, and with the C&S Wholesale transaction closed, a wind down plan was acted upon.
  • SCP interacted with Creditor Committee inquires, vendor inquires on PACA claims and as the sale process wound down, prepared a final wind down plan for the business.
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Confidential Pre-Mix Supplier

Situation

  • An SCP professional was retained by a $25 million family-owned pre-mix supplier to Dunkin Donuts.
  • The company was quickly growing which put pressure on their ability to keep up with production, so they borrowed the money to purchase a $5 million production line from a well-known European manufacturer with US operations, who failed to produce a mix line that produced mixes at the rate and quantity as contractually required.
  • Litigation ensued, which wound its way through the normal course, with ruling in favor of our client, at which point, the US subsidiary/ defendants positioned that they were broke and unable to commercially address any settlement offer.

SCP'S SOLUTION

  • SCP led the Company through the due diligence process on the US subsidiary with the intent to take it over, as it was now the largest creditor. This process included site visits, a plan to embed the operations together, and related proforma business projections, etc.
  • As the European parent company became more aware of their US subsidiary’s position, they stepped in and came to a commercial resolution and funded a settlement.

Results

  • SCP’s operationally-focused work initially had to demonstrate that the production equipment was incorrectly engineered/mismanaged, and damaged.
  • When our client decided to potentially take over the US subsidiary operations, we worked with them to operationally put the two businesses together.