Interim Dairy Farm Management Gets Full Value Sale
25M
Annual Sales
20M
in Debt
Michigana Farms, Kalamazoo Michigan
Challenge
$25 million large dairy farming operation. $20 million secured debt. MorrisAnderson acted as Receiver and Investment Banker. Quick sale process resulted in completed sale in just 114 days.
- 6,200 herd cattle and dairy operations with 3,000 dairy cows.
- Company under liquidation process.
- Limited options to maximize value given time constraints of liquidation process.
Solution
- MorrisAnderson engaged as Receiver and began investment banking and operational improvements to maximize value.
- Industry insight provided expertise to identify $2 million of annual cash flow improvements.
- Structured three part sale and identified three groups of interested parties to maximize activity in auction process.
Results
- Three part sale structure provided floor for initial stalking horse bids.
- Structure created avenue for going concern buyer to step in but also created requirement to overbid the piece meal bidders.
- Final bid by going concern buyer was 20% higher than initial bids due to structure.
- Cash paid to senior secured lender 114 days after implementation of sales plan.
