Industries

Consumer Products & Retail

The dominance of e-commerce platforms and the shift in consumer shopping habits from in-store to online has transformed the basic operating principles of the consumer products and retail industries. With increased pressure from global online competitors and a need to minimize the real estate footprint in shopping malls and other traditional retail locations, many middle-market retailers are at a loss of how to move their business forward while also winding some of it down.

We support all middle-market consumer products and retail companies in evaluating their strengths and weaknesses, and coming up with a profitable business strategy. See how we can help you.

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Case Studies

Consumer Products & Retail 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

Ahmed Shamsi

Director

John Halloran

Senior Director

Curt Kroll

Partner

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William White

Senior Director

BiographyNotable Assignments

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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.
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Roger Gorog

Senior Director

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Industry Expertise

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.
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Christian Sorensen

Senior Director

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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.
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Timothy Bossidy

Managing Director

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Industry Expertise

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 lives in Los Angeles.

  • 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.
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Philip Kaestle

Managing Director

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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, distribution, entertainment, financial services, food and beverage, healthcare, industrial services, manufacturing, marketing, media, real estate and retail.

Philip has served in a variety of senior-level positions including Interim President, Chief Restructuring Officer, Interim Chief Financial Officer, Liquidating Trustee, Financial Advisor and Investment Banker 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.

  • 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 is in the process of effectuating an orderly wind down of the business, which has already resulted in full repayment to the pre and post-petition lenders.
  • Chief Restructuring Officer and Interim Chief Financial Officer to a color marketing manufacturing company where he executed a series of cost reductions and operational improvements to increase profitability despite a challenging operating environment. He also assisted with the sale of the company, resulting in full repayment to the senior lender.
  • 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

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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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Ahmed Shamsi

Director

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Industry Expertise

Ahmed Shamsi, a Director out of Los Angeles at SierraConstellation Partners, supports Directors in providing operational and financial restructuring and advisory services to both underperforming companies and companies in transition.

Prior to joining SCP, Ahmed was an Audit Senior at Deloitte & Touche. His responsibilities included supporting and leading financial statement audits by identifying financial reporting risks, overseeing the implementation various audit procedures, and effectively managing teams of 2-5 people to meet strict reporting deadlines. Through auditing Ahmed has gained exposure to a variety of industries including Financial Services, Retail, eCommerce, and Manufacturing.

In 2021, Ahmed won the 15th Annual M&A Advisor Turnaround Award under the category of ‘Turnaround of the Year (Over $100MM)’ for his work with Alto Ingredients (fka Pacific Ethanol).

Ahmed earned a B.S. in Business Administration and Accounting from the University of Southern California. He is a CFA® charterholder and a licensed Certified Public Accountant (CPA) in the state of California. In 2021, he successfully completed ACG’s Middle-Market Certification program.

He is a member of the CFA Institute and CFALA society.

  • Managed a portfolio of distressed real estate assets and wholesale fabric businesses. Ahmed assisted with a $156M real estate transaction to obtain fresh liquidity of $19M for the business portfolio that extended the liquidity runway and improved strategic options for the portfolio. Additionally, he oversaw the winddown of fabric operations that yielded approximately $1.2M which were used to pay expenses and paydown bank debt.
  • Spearheaded audit that generates one of the highest fees among nonpublic clients within LA consumer products audit group. Responsibilities include leading quarterly financial statement reviews, executing work with minimal guidance and supervision, and coordinating workflow effectively between staff/senior team members to meet strict client deadlines.
  • Analyzed retail stores for impairment by performing sensitivity analysis on client’s DCF models by adjusting key assumptions (revenue growth rate and EBITDA margin). Resulted in a ~$500K finding that was communicated to the client.
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John Halloran

Senior Director

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Industry Expertise

John Halloran, a Senior Director at SierraConstellation Partners, provides interim management and operational and financial advisory services to underperforming companies and companies in transition. He leverages a growing track record at SCP and prior experience as a management consultant and private equity investor to help middle-market companies navigate through difficult business challenges. His experience includes exposure to various industries, such as pharmaceutical/biotechnology developers, consumer-facing brands, retailers, and distributors, media & entertainment providers, and information technology services and platforms.

John’s recent work at SCP has been recognized by industry awards, including:

  • In 2023, John was recognized by the Global M&A Network as an Americas “Rising Star Dealmaker,” which recognizes outstanding young dealmakers from the North and South American private equity, growth investing, lending, M&A and restructuring communities for their achievements in the space.
  • In 2023, John won 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 2023, John was recognized with colleagues by the Global M&A Network’s 15th Annual Turnaround Atlas Awards for the SCP team’s leadership of NewAge, Inc. in the category of Chapter 11 Restructuring of the Year (sm).

John has completed relevant professional education including the Chartered Financial Analyst (CFA) and Certified Insolvency & Restructuring Advisor (CIRA) designations. John is also active in several industry associations including the Turnaround Management Association (TMA), the Association of Insolvency and Restructuring Advisors (AIRA), and CFA Society New York.

Prior to joining SCP, John was an investor with Omaha Beach Capital. There, he supported management of private equity investment vehicles, with a focus on underwriting lower- and middle- market transactions. He began his career as a management consultant with Booz Allen Hamilton’s Strategic Innovation Group.

John holds a B.S. and M.S. degree in Political Science from the Massachusetts Institute of Technology (MIT). He is an alumnus of Chaminade High School in Long Island, New York.

  • Financial Advisor and Deputy Chief Restructuring Officer to a commercial-stage developer of branded OTC pharmaceutical products. As a Financial Advisor, analyzed cash flow assumptions, assisted the board in evaluating strategic alternatives, and conducted out of court negotiations regarding the settlement of liabilities. As Deputy Chief Restructuring Officer, facilitated negotiations to secure a stalking horse bidder, completed a sale of the company's assets through a 363 sale, and coordinated the Chapter 11 case requirements in Delaware.
  • Financial Advisor and Chief Restructuring Officer Support for a national dance events producer. Completed a review of company liquidity and business plan and assisted in negotiating a capital infusion from the senior lender to bridge the company to a sale transaction after events of default. Managed the company's cash flow and implemented cash controls on behalf of CRO and Board during the sale. The company was successfully sold to a private equity buyer in an out-of-court transaction.
  • Chief Restructuring Officer Support for the restructuring and sale of a global, publicly traded multi-level marketer of health and wellness products. Instrumental in ensuring that the company could prepare for and meet bankruptcy case requirements despite the limited budget and timeline. Key contributor on the SCP project team in their coordination of the company's finance function during the Chapter 11 proceedings in Delaware despite significant management turnover.
  • Interim CEO Support to a diversified IT services and solutions provider based in Canada and US. Assisted the CEO in overseeing company operations and communications with lenders regarding the company's capital needs in connection with a potential restructuring transaction. Oversaw the cash flow forecasting and reporting process for two independent operating entities and presented regular updates on behalf of company to lender group.
  • Chief Restructuring Officer and Liquidating Trustee Support to a wholesale distributor of beer, wine, spirits, and non-alcoholic beverages where he facilitated extensive transaction diligence for its acquisition by one of the world’s largest brewing companies and assisted the Liquidating Trustee in managing the satisfaction of all company obligations during its wind down post-close.
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Curt Kroll

Partner

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Industry Expertise

Curt Kroll, a Partner at SierraConstellation Partners, provides interim management and operational and financial advisory services to underperforming companies and companies in transition. His experience includes challenging CRO roles, interim management, refinancings, distressed acquisitions and in- and out-of court restructurings. Mr. Kroll has held roles in various industries including retail, industrial manufacturing, real estate, financial services, and healthcare.

Prior to joining SCP, Mr. Kroll was the Chief Financial Officer and Chief Information Officer at Katy Industries, Inc., a publicly-traded manufacturer of consumer and industrial products with operations throughout the United States and Canada. While at Katy, he worked on numerous refinancings, acquisitions, operational integrations, and restructuring transactions. Prior to Katy, Mr. Kroll was a manager at Deloitte where we worked with middle-market and corporate clients across industries. Prior to Deloitte, he also spent 3 years in a regional public accounting firm working with middle-market companies.

In 2022, Curt won the M&A Advisor’s 16th Annual Turnaround Award (between $10mm and $100mm) for his work on the turnaround of francesca’s.

Mr. Kroll holds both a bachelor’s and master’s degree in accountancy from the University of Missouri. He is licensed as a Certified Public Accountant (CPA Inactive).

  • Served as CFO of a publicly traded-consumer product manufacturing company where he lead the company through a restructuring process that ultimately led to a return to investors through the sale of the business.
  • Served as a financial advisor to a $500 million outsourcing company through a sale process to a private equity group.
  • Served as a financial advisor for a $600 million oil and gas pipe manufacturer in a refinancing of its debt.
  • Served as a CRO to a $700 million national retail chain during its restructuring process.
  • Interim Chief Financial Officer to a national bridal retail company where he led the team post-bankruptcy to rebuild the Company’s brand image, employee morale and trust with key stakeholders including the debt holders.
  • Chief Restructuring Officer and Interim Chief Financial Officer to a national retail company where he executed a series of cost reductions and operational improvements to increase profitability despite a challenging operating environment. He also assisted with the sale of the company.
  • Was interim CFO to an 80-store candy retailer.
  • Served as a financial advisor to several clients within the healthcare industry on capital bond issuances raising over a billion dollars in capital.
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francesca's

SITUATION

  • francesca’s is a Houston-based fast fashion women’s retailer that operated in 460+ stores nationwide in traditional malls, lifestyle centers, and outlets.
  • The Company filed for bankruptcy in December of 2020 and sold its assets via a 341 sale at the end of January 2021.
  • A factor in the Company’s financial difficulty was the fact that it had become heavily promotional in recent years under interim leadership.
  • Post-emergence, the Company struggled with fundamental issues such as completion of landlord deals, avoidance of cure payments through contract renegotiation, basic bank account management, and extensive management turnover.
  • February results were extremely poor, and the company faced an immediate liquidity crisis.

SCP'S SOLUTION

  • The sponsor initially retained SCP to “stand up” the Company’s finance and accounting function post-emergence.
  • SCP’s initial work focused on improved trustee communication, implementing a cross-functional approach to contract assumption, and analyzing the Company’s discounting practices.
  • SCP was eventually retained as Interim Chief Financial Officer.
  • SCP pursued a number of projects and strategies focused on changes in culture and operational efficiency, as well as improving communication and collaboration with the debtor trustee.

RESULTs

  • Gross Margin improved from 40% in February to 51% in March and 69% in April 2021.
  • Sales and Margin exceeded budget every month from March-August.
  • The Company saved over $1 million in cure costs on operational contracts (no landlords).
  • Equity holders have been able to make meaningful equity distributions.
  • A full-time Chief Financial Officer was hired in mid-August 2021.
  • All remaining debtor items were successfully transferred to the trustee advisor.
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National Bridal Retail Chain

SITUATION

  • $700 million revenue, 300+ store national retail chain with over 30% market share in the bridal wedding dress space.
  • The Company emerged from bankruptcy in January 2019 and immediately began missing the plan. 
  • A factor in the Company’s financial difficulty was the fact that it had become heavily promotional in recent years under interim leadership.
  • The Company was not communicating with the consumer effectively in the digital age due to not being truly omnichannel despite having the #1 bridal website.
  • Retained SCP professionals as interim Chief Executive Officer and Chief Financial Officer to stabilize sales, restructure the store sales leadership, implement omnichannel policies and re-market the Company to the Millennial and Gen Z consumer.

SCP'S SOLUTION

  • Restructured the sales leadership team, hired social influencers, and commissioned a new website to better interact with the consumer.
  • Designed and manufactured new dress styles to be more relevant to the consumers’ desires.
  • Established shipping, return, discount, and sales policies to be consistent between in-store and online consumers.
  • Restructured more than $20 million of SG&A spend.
  • Set the strategic vision for the 2020 “Bridal Christmas”.

RESULTs

  • Stabilized the sales and began comping year-over-year sales for the first time in three years.
  • Achieved more than $20 million in cost savings on an annualized basis.
  • Transitioned the stabilized Company back to an in-house Chief Executive Officer and Chief Financial Officer.
  • The stabilization of the Company allowed management to raise $55 million in additional capital to fund further consumer-focused initiatives.
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Manufacturer Of Wholesale Apparel

SITUATION

  • A Southern California-based, $515 million manufacturer of wholesale t-shirts and retail women’s fitness apparel experienced a rapid decline in liquidity driven by the anti-government uproar in Central America, which caused supply chain capacity constraints and a glut of ineligible work-in-process inventory.
  • SCP was retained to develop an operational and financial analysis to explain the supply chain disruption, evaluate the Company’s financial forecast and build a conventional 13-week cash flow to support a $50 million upsizing to its existing asset-based credit facility.

SCP's Solution

  • Created a short-term weekly cash flow forecast used to better manage liquidity and optimize Alo Yoga’s growth strategy.
  • Fully transitioned an integrated cash flow forecasting process into the existing finance and accounting infrastructure.
  • Developed a thorough lender assessment presentation which became a valuable asset in the upsizing underwriting process.

RESULTs

  • SCP was engaged to better understand the growing pains that the Company was experiencing as a result of rapid growth and expansion. Management failed to invest in the necessary finance and accounting infrastructure to enable proactive liquidity planning and management. This caused some strain with the senior lenders even though the Company was performing well.
  • SCP spent time with executive management to complement and execute the plan to rectify the supply chain issues. SCP also spent considerable time with the financial controller and accounts payable employees to fully integrate a cash flow model and weekly management process.
  • SCP met with lenders to talk through assessment and findings, which helped justify a $50 million upsizing to the Company’s existing facility.
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Beauty and Personal Care Products Company

SITUATION

  • Company operates as an innovation platform that develops, incubates, and accelerates beauty and personal care brands and products in response to rapidly shifting consumer needs and market trends.
  • Company ownership split between the founder and a consumer-focused private equity firm.
  • Confluence of industry headwinds, the pandemic, and business-specific factors led the Company to experience a liquidity constraint and default under the senior secured facility.
  • Following defaults under the Company’s senior secured loan, SCP was retained to serve as financial advisor and the role of Chief Financial Officer to the Company to develop a cash flow forecast, recommendations for operating improvements, and strategic alternatives to maximize recoveries to all stakeholders following the defaults.

SCP's Solution

  • Developed weekly cash flow, operating budget, and review of strategic alternatives to negotiate amendment with the senior lender, while providing additional liquidity (over-advance and equity infusions) to maintain normal business operations.
  • Identified and implemented operational changes, particularly relating to cash management to accurately and effectively manage liquidity via the collection and disbursement processes, as well as profitability analyses for new customers / SKUs.
  • Initiated a direct line of communication with the existing lender group, and established weekly reporting and updates.
  • Leveraged SCP relationships to complete short-term and long-term financings to provide the Company additional working capital for assets ineligible under existing facilities, and provide a fulsome solution for existing lenders that were fatigued following an unsuccessful sale process.

RESULTs

  • Successfully negotiated an amendment with existing senior secured lenders which provided the Company continued liquidity to maintain operations and support a longer-term solution to preserve value. As part of the process, negotiated for equity sponsor to infuse additional capital into the business, and created additional liquidity through a new working capital debt facility to support growth initiatives.
  • Successfully completed a longer-term solution in a $20mm refinancing of the existing senior lenders that were fatigued. Refinancing allowed the Company to focus on operations and its growth plan, providing additional capital to the balance sheet in the process.
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Confidential Wellness Products Company

SITUATION

  • Company was facing executive turnover, several active government investigations (including SEC related to financial disclosures and DOJ related to Foreign Corrupt Practices Act violations by prior management), a precipitous decline in revenue and cash flow because of the impact of these distractions, and acute liquidity challenges. 
  • SCP was engaged by the board, inheriting a situation that was extremely precarious from day one. The Company’s global operations represented the amalgamation of a variety of M&A transactions, of which many of the Company’s entities had not been successfully integrated by prior management.  The Company’s core business relied on a global network of brand partners to conduct sales of the Company’s health and wellness products.  There was a meaningful risk that these partners could lose confidence in the Company.  
  • Meanwhile, company insiders engaged in several alleged acts against the best interests of the Company, which became the subject of litigation.  Against this backdrop, performance was weak and deteriorating. 

SCP'S SOLUTION

  • SCP professionals delivered exceptional services, including, but not limited to, the following areas: 
    • In the role of CRO & CRO Support, SCP was instrumental in identifying and advising the Board on appropriate measures to protect and maximize the Company’s value.
    • SCP assisted the Company in resolving a settlement with the DOJ/SEC on certain matters that were subject to investigation. 
    • An SCP team member also became the Company’s Principal Financial Officer after the departure of the CFO, and the SCP team oversaw the finance function at the Company.
    • SCP extended the company’s cash runway by several months from the time of its engagement until a viable sale option emerged. This effort involved liquidity management in a complex web of global entities supported by an understaffed finance and accounting team impacted by turnover and poor integration of prior transactions. 
    • SCP conducted preparations for Chapter 11 process under an expedited time frame and supervised a robust sale process by an investment banker.
    • SCP also worked directly with a strategic buyer to sell a non-core division.

RESULT

  • The SCP team shepherded the Company’s social selling business through a sales process consummated through Chapter 11 proceedings. The sale process allowed the company to survive as a going concern and preserve jobs. 
  • The Company’s social selling business was sold for an estimated $28 million in proceeds to the estate, funded as a credit bid by the Debtor in Possession (DIP) loan provider. The purchaser also modified their bid to purchase the equity, rather than the assets, of one of the company’s key subsidiaries, further enhancing recovery to creditors above and beyond the initial bid. Post-closing, the SCP team also oversaw the sale of the Company’s Direct Store Distribution (DSD) business, unlocking additional value. The sales closed in October 2022 and December 2022, respectively. 
  • The Chapter 11 plan received court approval for confirmation after resolution of a dispute negotiated by SCP and counsel over cash reconciliation matters.  Due to settlement terms, cash was set aside for a liquidating trustee to pursue litigation claims that may hold significant potential value for creditors.