Will-Grocers-Succumb-to-the-Current-Retail-Crisis

Will Grocers Succumb to the Current Retail Crisis?

We’ve recently seen an unprecedented number of retail store closings. Retail bankruptcies in just the first half of 2017 have already surpassed the number of retail bankruptcies for the entire year of 2016. If supermarkets follow in the footsteps of other retail segments, then 2017 could be disastrous. Joining the list of bankrupt companies are Marsh Supermarkets Holding, LLC and Central Grocers, Inc., both of which filed for Chapter 11 bankruptcy in May 2017. What does the future hold for grocers? Are supermarkets facing the same demise as other brick-and-mortar retailers?

The good news is that food is a necessity and not a luxury.  The bad news is that margins are razor thin and competition is relentless. Grocery stores, not unlike brick-and-mortar retailers, are hanging on by a thread, not just trying to thrive but simply survive in this environment. What is driving such intense competition for grocery stores?

  • Food deflation contributed to price wars as grocers passed along savings to consumers; although consumers benefited, the result was even lower margins for grocers
  • Expanding and competing retail channels for groceries including other options such as meal delivery service
  • Invasion of foreign discount supermarket chains in the US; Lidl is a new entrant while Aldi has announced aggressive expansion plans
  • Changing consumer behavior and expectations including convergence of brick-and-mortar and online shopping; delivering perishable and refrigerated goods has some unique challenges

Supermarkets have been somewhat insulated from the online pressures contributing to the demise of some brick-and-mortar retailers. But grocers are no longer immune. As a supermarket operator, are you experiencing these tell-tale signs?

  • Unable to meet sales forecast and experiencing declining same store sales
  • Struggling with cash flow and forced to stretch payables to vendors or requesting an accrual of interest payments
  • Experiencing high turnover including the loss of key management
  • Negotiating with Lenders only willing to extend maturity dates on a short-term basis
  • Cutting your capex spend in half so you have sufficient cash to continue to operate and service debt

If you are spending more time putting out fires than performing your day-to-day duties, then it probably means that your business is in trouble.

The time frame to act is getting shorter and retailers need to conserve cash — to ensure that the runway is long enough to allow for an operational turnaround of the business or debt restructuring, or risk liquidation. Recognizing the warning signs and taking action early will ensure the best possible outcome and preservation of value.

Stop Hemorrhaging Cash

The first step is gaining control of your cash. This may require applying a tourniquet to stop the bleeding.  Be realistic about the performance of your business and understand your cash needs.

  • Develop realistic financial projections so you do not fail before you even begin
  • Understand your cash needs; prepare a rolling 13-week cash flow forecast to understand immediate cash needs and a long-term cash flow forecast to account for one-time payments
  • Optimize liquidity through effective management of accounts receivable and payable; don’t leave money on the table; a simple phone call may be all that’s needed to prompt customers to pay past due amounts
  • Involve the entire organization; ask your employees for creative ways to save money; reward them with a pat on the back or provide monetary incentives

Operational Restructuring

The second step is fixing the business.  Companies need to assess operations and take the necessary action steps to ensure the survival of the business.

  • Identify the problems and find solutions
  • Maximize operating efficiency
  • Improve margins and profitability
  • Stabilize the business
  • Set realistic goals and manage stakeholder expectations
  • Restore the trust and credibility of creditors and employees

Financial Restructuring

Lastly, you may be operating at higher efficiency, but this may still not be enough to service your debt especially for companies that are highly leveraged. A debt restructuring may be necessary to ensure the company’s long-term viability.

  • Develop a plan which maximizes recovery
  • Be transparent and provide clear communication to all parties; be cognizant that lenders or investors may be losing all or part of their investment
  • Assess whether a debt restructuring can be done out-of-court; this will require consensus which may be difficult given different interests among creditors
  • Retain professionals to assist

Summary

Our experience tells us time is of the essence. Companies often wait until they have burned through their cash and depleted other resources before taking action. A turnaround specialist or Chief Restructuring Officer (“CRO”) has the independence and can make the hard decisions. Often a company in crisis will have lost credibility and the trust of its creditors and employees. A CRO can build the consensus necessary for a successful turnaround of the business, leaving Management to focus on operations, safeguard the business and prevent further deterioration.

The entry of Lidl in the US, aggressive domestic expansion plans of Aldi and the combined forces of Amazon and Whole Foods will only make it more difficult and disruptive for grocery operators in 2017 and beyond.

Loughlin Management Partners + Company (“LM+Co”) has a team of turnaround and retail specialists that can assist companies in navigating the complexities of the corporate restructuring process.

 

Strengthening the Fundamentals: Critical Building Blocks on the Path to Grocery Success

With Amazon’s recent purchase of Whole Foods, pundits are speculating what the reaction and next move should be among grocers struggling to survive. Grocers already face intense competition, not only from traditional supermarkets but from a wide-ranging array of other retail channels, including supercenters, warehouse, limited assortment, specialty, discount and convenience/drug stores.  Given the entry of Amazon, an e-commerce juggernaut with the resources to significantly alter the landscape, is it time to give up?  Should operators just throw in the towel?  Our answer to those operators willing to focus on the fundamentals is a resounding NO.

More than ever, grocery operators need to focus on the customer, food and store atmosphere.  Your store needs to be the place where customers can escape.  Shoppers want – in fact they DEMAND – a clean and friendly place where they’re greeted by displays of colorful fresh produce and flowers, can taste a sample of the latest imported cheese and enjoy the aromas of roasting coffee and freshly-baked bread.  And most importantly, today’s discerning, some would argue finnicky, shopper looks for welcoming smiles from helpful staff when they need it.  A website, no matter how sophisticated and efficient, can’t replicate the sensory experience and compete with a friendly smile.

Too many companies are focusing on factors out of their control and losing sight of some basic fundamentals that, with the proper levels of planning and executional consistency, can yield a positive impact for grocery operators in a relatively short timeframe.

Think about it:  losing a customer is easy, while customer acquisition is difficult and expensive.  Customers are fickle and generally have little or no loyalty especially given the number of options available. Key to enhancing the customer experience, which is critical to operational and ultimately financial performance improvement, is a focus on the core values and key elements important to today’s shoppers, which we refer to as “the 4P’s.

  • Physical attributes of the brick-and-mortar
  • Product offerings and selection
  • Price and value perception
  • Pleasing customer experience

Physical Attributes
Doesn’t Amazon’s biggest bet yet with the acquisition of Whole Foods mean that brick-and-mortar stores are still relevant?  Do your shoppers keep coming back or are they turned away by the unkempt appearance?  Do your displays make consumers want to buy more than what was on their original list?

  • Location and proximity: Consumers tend to choose stores closest to where they spend the bulk of their time, whether that be their home or office
  • Ease of entry and exit: People value time and convenience
  • Efficient pickup: Customers expect timely processing of orders and ease of pickup for online orders
  • Visual appeal: Exteriors and interiors of stores including bathrooms should be well-maintained
  • Cleanliness: Store cleanliness ranks high among customers especially when purchasing food

Product Offerings
How do you incentivize consumers to shop at your store?  Are your customers willing to drive a little farther or pay a premium?  Are your products of the highest quality to satisfy even the most discriminating shopper?

  • Selection: There is increasing demand for fresh, organic or gluten-free products
  • Specialty: Stores can differentiate themselves with a wide selection of specialty products such as imported cheese or olive oils
  • Prepared foods: American are increasingly turning to prepared foods to save time
  • Fresh produce: Produce can dictate whether a customer chooses to shop at your store
  • Quality products: Maintaining the highest quality products ensures that customers keep coming back

Price and Value Perception
Are you competitively priced?  Do your customers realize that your prices are lower than that of your competitors?  Are your customers’ basket size bigger than your competitors?

  • Promotions: Customers like to feel that they are getting a good deal
  • Price: Operators need to ensure that their investment in price reductions are being valued by their customers and not just furthering reducing margins
  • Private labels: Companies are continuing to expand on their offering of quality and reasonably priced alternatives to branded products
  • Signage: Customers like easy to understand pricing and signage which identifies weekly promotions
  • Inventory: Operators need to ensure that there are no empty shelves and out-of-stock inventory especially for promotional items

Pleasing Customer Experience
Are your staff friendly and helpful?  Are you making sure your customers’ shopping experience is quick and easy?  Do your customers look forward to coming back?

  • Checkout: Shoppers value their time so a quick and easy checkout is important especially during peak hours
  • Staffing: Stores need to have adequate staffing at the various counters such as deli and bakery to avoid long waits
  • Layout: Store layouts should be logical to allow for ease of finding products
  • Service: Finding friendly and helpful staff when you have a question can easily turn the customer experience from frustrating to pleasant

Summary
Investing in online and innovative strategies is great, but wasteful if you are losing customers due to dirty floors and bathrooms, having to wait in long lines at the deli counter or checkout, touting yourself as the provider of organic produce but displaying spoiled and bruised products and marketing promotional items to attract customers but having customers walk away because of empty shelves.

Loughlin Management Partners + Company (“LM+Co”) has a team of highly experienced financial, operational and analytical professionals that can partner with you to assess the situation, focus on the key issues and identify opportunities to enhance profit and cash flow.  Our retail specialists can:

  • Identify operational improvements in sourcing, supply chain and inventory management
  • Perform store profitability analyses and closure strategies
  • Assist with labor optimization to reduce costs and maximize staffing
  • Conduct review of customers and SKUs for profitability and rationalization and
  • Develop a turnaround plan or debt restructuring

We are available to help navigate the issues in this difficult and turbulent time for retailers and grocers.

Thoughtful 100-Day Planning

Reduce Risk Without Adding Time

In today’s competitive M+A market, the push to close deals quickly is stronger than ever. Fewer proprietary deals are on the table and more firms are bidding on each opportunity. As a result, a lightning-fast but still effective buy-side diligence, complete with a vetted 100-day plan, is critical to a successful investment.

100-day plans drive immediate value creation, and put the company on the right track for long-term success. Whether it is designed to change strategic direction or accelerate the current strategy, this plan has several characteristics:

  • Based on a solid assessment of the company rooted in direct observation
  • Customized to the company
  • Integrated with diligence and completed before deal close
  • Created in collaboration (or not) with current management
  • Aligned with investment thesis

From these ideas, a detailed, formal document that includes achievable initiatives and appropriate incentives is created. Loughlin Management Partners’ five-part process outlines a practical guide to operational diligence and development of a successful 100-day plan.


Part 1: Preparation

Prior to visiting the company, potential buyers should make thorough data requests. In addition to financials, request operational metrics, dashboards, key contracts and organizational charts. Companies that are either reluctant or unable to provide data should draw extra skepticism. While this is a potential risk, it is also an opportunity: a firm succeeding despite a lack of information availability likely has significant upside.

Looking at the provided information, ensure that you compare to the industry standards. How are their KPIs performing compared to peers? Is their inventory turning faster than the industry? Is SG+A twice that of a similar company? Often, broad market performance hides company-specific deficiencies and can lead to a poorly performing investment.

Labor, a much maligned expense, is likely not an issue. Unless overtime is greater than 25%, or there is excessive headcount (again, compare to competitors), direct labor (especially wage rates) is rarely the problem.

Better bellwethers for labor inefficiency are in two areas: organizational structure and variable pay. If the organizational chart has more than three layers of management, or if there are many managers with only one or two reports, there is likely a problem.

Comparing fixed to variable compensation also provides a barometer of efficiency: sales functions should have a minimum of 50% variable pay, and management should have a minimum of 10%, with higher levels having more of their pay on the line. Alignment to performance, especially in a growing middle-market company, is critical for success.


Part 2: People

Ensuring the right management team is in place is a primary goal for any 100-day plan. Without the right people, the best processes or newest technology will make little difference.

When meeting with senior management, focus on three things:

  1. Involvement with Operations
  2. Relationships (familial and otherwise)
  3. Skillset

The best management teams establish a visible presence without interfering in day-to-day operations. If the C-suite is constantly putting out fires, they are likely not focusing on long-term growth. This is often an indication that middle management is underperforming, or do not trust their subordinates. Conversely, complete disconnection from the front line business generally results in cost inefficiency (working capital is typically the most obvious area) and poor decision-making.

Especially with rapidly-growing lower to middle market companies, personal relationships between senior management and employees can be sources of risk. The appearance of nepotism can be as damaging as actual nepotism. Informal relationships often create back channel communication pathways, undermining middle management.

Lastly, and perhaps most importantly, is determining if this is the team that can execute your strategic vision for the company. Middle market CEOs are usually entrepreneurs, strong at launching a company, but not necessarily good at scaling. Alternatively, they may be strong in a single function, like business development, but have little idea how the product is manufactured. In that situation, have they built a competent team around them to complement their weaknesses? If not, that problem likely trickles down to middle management as well.

Often some of the best insights come from middle management, line supervisors and employees. Is there a strong middle management layer? Or does the COO, for example, have 20 direct reports? Investigate how deeply data drives day-to-day decisions. If dashboards or KPI reports are hard to come by, they are probably not using them. Finally, are the employees happy, with a strong sense of job satisfaction? It sounds like a simple question, but dissatisfaction is a symptom of deeper, business related issues that can undermine profit.


Part 3: Process

The first indicators of strong process are robust safety programs and tidy workspaces. During facility walkthroughs, make a point of investigating off the tour path. If cleanliness is lacking, it’s likely that more complicated processes are being shortcut as well.

Pay particularly close attention to inventory. What are the dates listed on materials and product labels? Is there a layer of dust on the boxes? Is there inventory sitting between each process step? These are indicators of poor production planning and scheduling processes.

Beyond production, one of the most critical processes to investigate is customer and product profitability. Simplistic pricing models often hold significant opportunity for easy top line growth, and incomplete or out of date costing can hide weak products or unprofitable customers.


Part 4: Technology

After the right people and processes are in place, technology may help you wring the last 20% of value out of an organization. In fact, technology tends to be a scapegoat, clouding root causes, which are more likely related to process.

When looking at systems, hardware is the first area to investigate: are there robust disaster recovery and business continuity protocols in place? Is the data center cold and well maintained? How old is the hardware? Server hardware older than five years and personal devices older than three years will likely require replacement.

Second, look at software. Is the ERP up to date? If not, why? If customization is causing the delay, there may be an issue. How accessible is data? All levels of the organization should have simple access to information appropriate to their roles.

Last, and often overlooked, review the security program. Did you have to sign in to get in the building? Were you issued a visitor badge and escorted? Who can access the data center? Does the ERP have role-based security enabled? Or can anyone see all of the data? Security is a critical component in risk management and, depending on the industry, it could also be a legal requirement.


Part 5: Conclusion

Often in the push to finalize a bid, bias to close quickly can result in unmitigated or unknown risk. As a result, many firms use third party advisors as a way of independently verifying the deal thesis as well as expediting the process. LM+Co’s deep operational and financial knowledge, as well as our fast turnaround time, have made us a natural choice for conducting middle market diligences, developing 100-day plans and leading project execution.

A 100-day plan addresses the risks and opportunities identified during diligence, and is developed prior to deal close. It is a detailed document, tailored to the company and suitable for high-level project planning.

To begin, separate the items into logical initiatives, and then quantify the effects. If there is no financial impact, it is likely not a value creating project. Once the list of initiatives is final, arrange them into a reasonable timeline, and add a buffer period to account for delays. 100-day plans are not bound to this timeframe; it’s more important to establish an achievable deadline. Finally, assign the right talent and incentivize them appropriately. Many project plans fail because improvement initiatives take a back seat to customer demands.

A well-architected 100-day plan serves as a common vision between you and senior management, minimizing investment risk and maximizing value creation. And there’s no downside: it can be incorporated into your diligence process without added time and, given the potential return, at minimal expense. With a strong 100-day plan in place, your investment can immediately start to build value.

LM+Co Capital Completes Successful Refinancing of TruFood Mfg., Inc.

Pittsburgh, Pennsylvania – April 28, 2017

LM+Co Capital, a New York-based middle market investment banking firm, announced today the successful refinancing of its client TruFood Mfg., Inc. (“TruFood”), based in Pittsburgh, Pennsylvania. BHI (Bank Hapoalim B.M.) and AloStar Capital Finance acted as co-agents on the refinancing transaction. Financial terms of the transaction were not disclosed.

TruFood is a leading East Coast snack food contract manufacturer of well-recognized brands serving the health-conscious, “on-the-go” consumer market. This family-owned business operates in the highly competitive Contract Food Manufacturing Industry where high-touch customer service, quality product execution and new product development is critical to success. TruFood manufactures a full range of snack products including granola products, baked bars, nutrition bars, layered protein bars and molded chocolate products.

Richard Zytkowicz, Managing Director with LM+Co Capital, stated “LM+Co Capital is delighted for Pete Tsudis and his management team as they embark on the next chapter of the TruFood legacy. Mr. Tsudis is a very successful CEO and operator with a proven track record in the Contract Food Manufacturing Industry. The completion of this refinancing transaction affords TruFood the opportunity to further expand its product offerings and establish a solid platform to explore and launch additional growth initiatives. We are honored to have been involved in such an exciting transaction”.

TruFood President and Chief Executive Officer Pete Tsudis noted, “Our partnership with Rick and the LM+Co team has been tremendously successful. They provided invaluable support and expertise throughout our refinancing process”.

About TruFood Mfg., Inc.
TruFood was founded in 1985 by Spiro Tsudis, father of current CEO, Peter Tsudis, to produce children’s fundraising chocolate candy. When Pete assumed control of TruFood in 2001, he quickly realized the various trends in the snack food market were changing to healthier forms of snack consumables and began to position TruFood to capture these manufacturing opportunities.

Today, TruFood partners with various multi-national companies to manufacture a variety of well-recognized snack brands. TruFood has a large presence on the East Coast with over 350,000 sq.ft. of state-of-the-art manufacturing facilities and continues to grow through its strong reputation for manufacturing high quality snack products for its marquee customer base.

About LM+Co Capital
LM+Co Capital is an independently operated affiliate of Loughlin Management Partners + Company, a multi-disciplinary professional services firm focused on the middle market. LM+Co Capital, a registered broker dealer and member of FINRA/SIPC, is solely focused on the middle market, providing investment banking and advisory services to corporations, investors, private equity groups and business owners. LM+Co Capital offers its clients years of experience in Mergers + Acquisitions, Capital Advisory, Financial Restructuring and Business Valuations.

About Bank Hapoalim B.M. (“BHI”)
BHI offers full commercial banking services that combine the personal attention and responsiveness of a prestigious boutique bank with the expertise and financial strength of a global bank. With a footprint in the largest U.S.  metropolitan areas, BHI is committed to creating innovative funding solutions for long and short term needs, and providing convenient banking and liquidity products for everyday business needs.

As part of the Bank Hapoalim Group, BHI is backed by the financial strength of a leading financial institution, giving BHI’s U.S. customers access to business financing from one of the world’s most stable banking environments.

About AloStar Capital Finance
AloStar Capital Finance offers needed capital and counsel to business leaders across America who are creating their own success stories. Through our Business Credit, Lender Finance and Real Estate Finance platforms, we create customized lending solutions for customers with capital requirements up to $60 million. To date, AloStar has closed more than 160 deals with commitments totaling more than $2 billion. At AloStar, you’ll have ready access to decision makers with deep capital industry experience who are responsive, flexible and eager to help you write your success story.

AloStar Capital Finance is a trade name of AloStar Bank of Commerce, Member FDIC. For more information, visit www.AloStarBank.com.

*LM+Co Capital is an independently operated affiliate of LM+Co. A licensed broker dealer, LM+Co Capital is registered with FINRA, SIPCFor a summary of LM+Co Capital’s registration with FINRA, go to BrokerCheck.

 

 

TMA NETWORKING and SPEED MENTORING Event

Join LM+Co’s Wen Rittsteuer, and Tom Wang along with other industry professionals for one evening of speed mentoring and networking with local entrepreneurs. This will be a fun opportunity to network with fellow TMA members and entrepreneurs, and also help entrepreneurs get off the ground and grow.

Serving… Wine & King Kolache Catering | A Czech-Tex Bakery (One of our many successful entrepreneurs)

Who Should Attend:
Financial advisors, lenders, attorneys and other skill sets are welcome. Attendees just need to have a keen mind and interest!

Registration Information:

  • Space is limited. Attendance will be offered on a first come first serve basis.
  • Online Registration will CLOSE at NOON on Friday, April 14th or when maximum capacity is met. Whichever occurs first.

Owners of Scripps Proton Therapy Center File for Bankruptcy

As Reported in San Diego Business Journal |March 2, 2017

The owner of Mira Mesa’s 3-year-old Scripps Proton Therapy Center has filed for Chapter 11 bankruptcy protection after failing to attract and receive reimbursement for treating a sufficient number of patients.

California Proton Treatment Center LLC said it has arranged a $16 million bridge loan it will use to continue operations at the $225 million facility managed by Scripps Health.

“Our doors will remain open to administer highly specialized cancer therapies, and a patient ombudsman will ensure that our transition to a new organizational framework won’t affect patients or staff,” CPTC’s chief restructuring officer, Jette Campbell, said in a news release.

Proton therapy is a form of precisely targeted radiation proponents say focuses on tumors while sparing surrounding tissue that might be damaged by conventional X-ray therapy. There are three such facilities in California and at least two dozen nationwide.

The bankruptcy filing came six months after Scripps increased the number of patients it treats at the center without receiving prior authorization by health plans. Scripps officials said in November the move led to a 15 percent to 20 percent increase in patient volume at the five-room, 102,000-square-foot facility.

Scripps said at the time it was directing more resources to pressuring private insurers to approve proton therapy treatments that can cost $60,000 or more.

CPTC said in a November statement patient access to the therapy had “steadily increased, and our outlook is positive.”

Scripps President and CEO Chris Van Gorder said he did not know about plans for the bankruptcy filing until after it happened, but that the health care system had been anticipating such a move for months because of CPTC’s “enormous amount of debt.”

“Scripps knew that this was a high-risk venture from the very beginning,” he said.

Van Gorder added that shortly before the center’s opening in 2014, commercial insurers shifted away from proton therapy toward a form of conventional treatment that uses a narrow beam of radiation. He said Scripps continues to believe proton therapy is the more effective therapy, largely because protons stop at the target site rather than continuing through a patient’s body.

He said Scripps has no financial exposure to CPTC’s bankruptcy, and that the health system only leases and operates it.

Lately, patient volume at the center has averaged 70 at any given time, even as more than 200 calls per month come in from people interested in receiving treatment there, Van Gorder said, adding that the facility needs a steady flow of 130 to 140 patients to thrive.

Scripps said in a written statement CPTC has asked the San Diego-based health-care system to continue treating patients at the center according to their contractual agreement.

The center’s medical director, Dr. Carl Rossi, said in CPTC’s March 1 news release the bankruptcy filing will “enhance our operations and allow us to administer our advanced proton therapy care to a wider spectrum of patients.” It was unclear from the release how the financial restructuring would accomplish those goals, and Van Gorder said he assumed Rossi was simply referring to expectations the center would continue to operate.

CPTC’s financial struggles surfaced Jan. 25 in a news release by Varian Medical Systems, a Palo Alto-based cancer technology manufacturer. The company said it had taken a $76 million charge relating almost exclusively to CPTC’s indebtedness to Varian and “lower than expected patient volumes that are insufficient to support CPTC’s capital structure.”

Varian’s CEO, Dow Wilson, said his company believes the proton therapy center can get on a more solid financial footing by “serving a broader patient population with additional health care providers locally and regionally.”

In September 2011, Varian and Dallas-based ORIX Capital Markets LLC agreed to loan up to $165.3 million to CPTC to fund the development, construction and initial operations of the Scripps Proton Center.

In November 2015, the two companies entered into a forbearance agreement, together with J.P. Morgan Chase Bank, which had assumed $45 million of the original loan, to delay receiving principal and interest payments until April 2017, subject to certain conditions.

Then, in January, Varian said it was informed CPTC and its loan agent had taken steps to address liquidity problems at CPTC. Varian’s analysis then was that these actions would “likely result in a serious liquidity event at CPTC, possibly leading to insolvency or bankruptcy proceedings at CPTC.”

In response, Varian decided to impair $38 million of the $98 million, including $29 million in accrued interest, still owed to the company by CPTC.

Loughlin Management Partners has been retained as financial advisor to the Senior Lender’s on this matter.

Erickson Inc. plan of reorganization confirmed by bankruptcy court

As first reported at Erickson Incorporated |March 21, 2017

Erickson’s restructuring will reduce the company’s pre-bankruptcy debt by more than $400 million upon emergence. In order to improve its capital structure and finance its exit from bankruptcy, Erickson was able to (i) obtain a commitment for an asset-based lending facility with a borrowing capacity of up to $150 million, led by MidCap Financial Trust, (ii) reach an agreement on non-cash repayment for $69.8 million in financing obtained during the bankruptcy, and (iii) secure a backstopped $20 million rights offering.

“These financial commitments demonstrate the creditor interest and support in restructuring Erickson’s financial affairs, servicing customer contracts, and enabling Erickson to continue operating well into the future. I am pleased and appreciative of our employees, customers and stakeholders who have supported us throughout this challenging process,” said Erickson president and CEO Jeff Roberts.

With the overwhelming support of all classes of creditors entitled to vote on the plan, Erickson will emerge from bankruptcy with the ability to grow its existing business segments of civil aviation, global defense and security, and manufacturing and maintenance, repair and overhaul (MRO).

“Erickson is extremely satisfied with this quick and successful outcome,” said Erickson CFO David Lancelot. “Erickson’s successful restructuring would not have been possible without the strong support of our funded debtholders and aircraft lessors. The financial impact of this approved plan is very positive and allows us to be far more strategic to compete in the competitive landscape. Haynes and Boone, LLP is Erickson’s restructuring counsel and other restructuring professionals included Imperial Capital, LLC and Alvarez and Marsal North America, LLC.

RadioShack Files for Bankruptcy (Again), Closing 200 Stores

As first reported in InvestorPlace |Mar 9, 2017 |12:43 pm EDT

General Wireless, which operates as RadioShack, is filing for bankruptcy again just two years after it came out of its last bankruptcy.

RadioShack says that it will be closing 200 of its stores at it enters Chapter 11 bankruptcy protection. This will leave it with 1,300 stores still open and it plans to evaluate what to do with these locations.

RadioShack notes that it many choose to keep its remaining 1,300 stores open on an ongoing basis. It claims that this may be the best way to maximize value for creditors. However, it also says it will explore other strategic options.

RadioShack says that it was making efforts toward returning to profitability after coming out of its bankruptcy two years ago. This includes reducing operating expenses by 23% in 2016 and gross profit dollars going up by 8% during that year. However, it still had problems.

“For a number of reasons, most notably the surprisingly poor performance of mobility sales, especially over recent months, we have concluded that the Chapter 11 process represents the best path forward for the Company,” Dene Rogers, President and CEO of RadioShack , said in a statement. “We will continue to work with our advisors and stakeholders to preserve as many jobs as possible while maximizing value for our creditors.”

RadioShack points out in its bankruptcy announcement that Sprint Corp (NYSE:S) was its partner responsible for managing its mobility business. General Wireless is a joint venture between Sprint and Standard General.

RadioShack says that it will post additional information concerning the bankruptcy on its website. Legal documents will be available on the Prime Clerk website. Prime Clerk is the company’s claims agent. It is also getting legal advice from Pepper Hamilton LLP and Jones Day.

Loughlin Management Partners has been retained to serve as financial advisor to General Wireless.

PROCURE PROTON THERAPY NEW JERSEY CELEBRATES FIVE YEARS OF SERVICE TO CANCER COMMUNITY

As first reported at www.procure.com |March 21, 2017

SOMERSET, N.J. (March 21, 2017) – Yesterday, ProCure Proton Therapy Center in Somerset, N.J., celebrated its five-year anniversary. As the first proton treatment center in the tri-state area and the 10th facility in the nation, ProCure is proud to have connected cancer patients and their families, from New Jersey and across the globe, with this life-changing treatment.

Proton therapy is an advanced form of radiation that destroys cancer cells by preventing them from dividing and growing. Unlike standard X-ray radiation, it uses protons – positively charged sub-atomic particles – which precisely target tumors. Proton therapy reduces the risk of damage to healthy tissue and organs near the tumor, and potentially allows patients to receive higher, more effective doses of radiation, but with fewer side effects.

Much to celebrate, and to honor
The anniversary converges with another important ProCure milestone: two weeks ago, the Center graduated its 2,500th patient. To celebrate, new and past graduates, alongside friends, family and ProCure staff, gathered together at the Center for a special graduation ceremony that honored the patient journey and the fight against cancer. The afternoon was rife with inspiring speeches, positive energy and a steadfast sense of community; it was a quintessential ProCure event.

Former ProCure patient Bob Jones is no stranger to these special ProCure moments. Five years ago, he entered the Center seeking treatment for prostate cancer, and was ultimately deemed cancer-free after 44 sessions and countless friendships formed. Bob was the 10th patient to graduate from ProCure, and has been an active member of the Patient Ambassador program since – attending graduations most weeks, sharing his story with others and lending advice to men facing prostate cancer.

“My experiences here in the span of five years – both as a patient and a friend of the Center – have been exceptional. The team here is kind, generous and compassionate, and I’m fortunate to be able to pay it forward through my role as an Ambassador,” Bob reflects. “It’s hard to explain the magic of this place to those unfamiliar – but it’s real, and it’s genuine, and patients are lucky enough to experience it while fighting cancer.”

Victor Lawson, another patient from the first class of 2012 graduates, also treated for prostate cancer, echoes many of Bob’s sentiments: “For me, ProCure played a critical role in my cancer treatment journey. In addition to offering me such great care five years ago, every time I return I’m greeted with the same welcoming atmosphere as when I first walked through the front doors on day one. The connections I’ve made here, both with staff and other patients, will remain my most fond memories of ProCure.”

ProCure’s first-ever patient graduate, Frank Mackinson, who was treated for a plasmacytoma of the skull base, adds, “They raise the bar tremendously as far as care and personalization goes. Since I’ve completed treatment at ProCure, it has been a joy to return to this pleasant facility and supportive community.”

Best-in-class treatment and services
ProCure New Jersey is the only proton therapy center in the metro NY/NJ area equipped with pencil beam scanning (PBS) – the most advanced proton therapy technology available today. The technique moves a proton beam of pencil-point sharpness back and forth across each layer of a tumor’s thickness and paints the tumor with radiation in three dimensions, rendering it ultra-precise and ideal for tumors located next to critical organs, such as those in the prostate, lungs, brain, head and neck, among others. PBS is also effective for pediatric cancers, where sparing healthy tissue is especially important for healthy development. ProCure’s PBS technology expands the center’s ability to treat difficult and complicated tumors, and is reflective of its commitment to continually advance cancer treatment options.

Over the past five years, ProCure has also worked closely with patients and their families to create tailor-made treatment plans that address each patient’s unique needs. The range of support available to patients extends from traditional care and pushing technological boundaries to insurance and financial counselors, a special pediatric playroom for patients and children of patients, and a concierge program to address personal needs like local accommodations.

“In the five years that ProCure’s been around, what’s struck me the most – in addition to our scientific capabilities – was how we’ve elevated patient needs and comfort as paramount values,” states Brian Chon, MD, treating oncologist and Medical Director of the Center. “The team goes above and beyond to make each person who walks through our doors feel like an individual — not just a cancer patient, not just an anonymous case file. It’s simply in the fabric of our culture.”

Dr. Chon continues, “We’re proud to have brought the unique properties of proton therapy to a diverse group of tumor types and cancer patients over these last five years. We will use this milestone to reflect on where we’ve been, how far we’ve come, and how we will work tirelessly to help our patients and the cancer community in the future.”

LM+Co Capital’s Q1 2017 Newsletter


We are pleased to present LM+Co Capital’s Q1 2017 Middle-Market Update. This newsletter offers a recap of 2016 activity and an overview of key trends impacting current US Mergers and Acquisitions (M+A) and Capital Markets.

 

*LM+Co Capital is an independently operated affiliate of LM+Co. A licensed broker dealer, LM+Co Capital is registered with FINRA, SIPC.