Boynton Beach, Florida
Distribution of landscaping and irrigation products. Revenues of $20 million down 67% from 2 years ago. $6 million in debt. Family had guaranteed loans.
- Sales revenue had declined to $20 million as economy ceased.
- Operating Losses in excess of ($150K) per month.
- Bank deemed $3.4 million of inventory ineligible, reducing Borrowing Base Availability to under $250K.
- Vendors stretched with $2.3 million of $3.5 million of A/P not current.
- Inventory being depleted to pay for cash burn.
- No unencumbered assets remaining.
- Bank demanded to be paid back within 3 months.
- Morris Anderson worked with management to cut costs and reduce EBITDA losses by $1.8 million annually.
- Reduced ineligible inventory by $1.5 million in 4 months, allowing company to purchase current product.
- Negotiated with bank to extend refinancing period to 6 months.
- Reached out to over 50 banks to refinance loans and 10 investors to purchase company.
- Company sold to Strategic Competitor providing jobs for employees and owner.
- Sold the company through an Assignment for the Benefit of Creditors to provide comfort to the buyer that old liabilities would not be its problem.
- Negotiated $800K discount from bank to satisfy loans and release the guarantees.