Equity Committee for Advanced Lighting Technologies, Inc. (ADLT). ADLT had filed Chapter 11 in early 2003
The creditors’ committee, led by GSC Partners (a $14 billion hedge fund) and consisting primarily of hedge funds, were aggressively advocating their plan which would have resulted in a minimal recovery ($0.05 per share) for Equity Holders.
• Overall financial and business assessment of the debtor
• Determination of equity value under various alternatives
• Determination of strategy in conjunction with legal counsel to maximize recovery to shareholders
• Led negotiations with other Stakeholders
• Algon “fights” for Equity Holders
• Plan confirmed – Equity Holders receive miscellaneous assets
• Algon retained by liquidating trustee to advise on disposition of assets
• Algon advises on strategy to dispose of miscellaneous assets
• Algon completes divestiture of assets resulting in $0.72 per share recovery to Shareholders
• Other Professionals: Jenner & Block, LLC; Strook & Strook & Lavan
• Davis Polk & Wardell; Shaw Gussis Fishman Glantz Wolfson & Towbin
• LLC; Brown Gibbons Lang & Company; Jefferies & Co.
C. Alan Bentley, Chapter 7 Trustee of Mego Financial Corp., bankrupt Estate of a $185 million timeshare and residential development company.
The Trustee spend 18 months addressing some of the larger items in the bankrupt Estate, but sought assistance in selling a number of illiquid assets as well as in evaluating whether certain past actions of management and members of the Board of Directors constituted cause for litigation.
• Assisted the Trustee in evaluating whether certain past actions of management and members of the Board of Directors constituted cause for actionable litigation.
• Assisted the Trustee in recruiting legal firms on a contingency fee basis.
• Managed the business aspects of the litigation and assisted in the settlement discussions.
• Assisted the Trustee in disposing a number of illiquid assets.
First Commercial Bank, an affiliate bank of Synovus Financial Corporation (NYSE: SNV), a $28 billion financial services company.
Through a loan foreclosure the bank became owners of 1,096,572 shares of common stock representing 28% of Aerosonic Corp. (AMEX: AIM), a thinly-traded public company based in Tampa, FL. AIM had substantial legal, regulatory and earnings issues including class action litigation and SEC and Justice Department of investigations. AIM’s stock price had declined approximately 80%.
• Realistic assessment of underlying business
• Recommendation of strategy, in conjunction with legal counsel, to maximize recovery and achieve liquidity
• Provided valuation services to the bank for GAAP purposes
• Created a “sense of urgency” for the AIM board
• Proactively presented options to AIM’s board and investment bankers
• Negotiated terms for sale and repurchase of Bank’s shares.
• Other professionals: Johnston Barton Proctor & Powell LLP; Raymond James & Co.
• Bank was able to divest its shares at 101% of basis.