Financial Buyers of Distressed Assets

In an economy rife with change and dislocation, there is substantial opportunity.  As companies or whole industries lapse into decline or suffer a sudden collapse, opportunities are presented to investors who have the wherewithal and counsel to navigate the landscape of restructurings and bankruptcies.  Our bankruptcy and insolvency lawyers have the knowledge and experience to advise investors in purchasing businesses and other assets from distressed companies, from letter of intent, due diligence, negotiation of break-up fees, and bidding and successor liability protections to obtaining bankruptcy court approval documentation and closing purchase and sale transactions.  We also have counseled investors in acquiring debt positions in distressed companies in order to acquire control over companies through the bankruptcy reorganization process.

Our significant current and recent matters include the representation of:

• Deutsche Bank AG as a creditor and the standby purchaser in connection with a Cdn $850 million rights offering.  The rights offering was a key component of Air Canada's plan of reorganization in a proceeding under the Canadian Companies' Creditors Arrangement Act.
• Deutsche Bank Securities in its $900 million commitment to act as the "stalking horse" bidder in the reorganization of Stelco Inc., the largest steel company in Canada.
• E. & J. Gallo Winery in the acquisition of the winery assets of Bridlewood Estate Winery pursuant to a Section 363 sale.
• Foothill Capital Corporation as the secured lender to Bugle Boy.  Our lawyers participated extensively in the negotiation of the purchase and sale transaction by which most of the assets of Bugle Boy were sold in a Section 363 sale.  This matter involved a competitive bidding process to select the "stalking horse" bidder, a highly unusual event.
• John Hancock Financial Services as the holder of over $120 million of term debt secured by various canneries and the equipment owned by Tri Valley Growers, which is among the largest canners and processors of fruit in the world.  The matter was resolved consensually when our client purchased the California operation (including assets not in its collateral package), obtaining full credit for its debt.
• The lead agent to a syndicate of lenders in a $75 million secured lending facility to supply chain management solutions and inventory logistics management.  Our lawyers participated extensively in the pre-petition negotiation and documentation of a sale of all assets and the post-petition competitive bidding sale process.
• MatlinPatterson Global Opportunities Partners L.P.,
• in its acquisition of joint ownership of Huntsman Holdings LLC.  This complex restructuring, accomplished through a negotiated plan of reorganization, included a debt for equity exchange offer, restructured bank debt facilities, a significant asset acquisition and negotiation of significant corporate governance matters;
• in its acquisition of a controlling interest in Polymer Group Inc.'s publicly traded notes and in the confirmation of consensual a Chapter 11 plan pursuant to which our client acquired a majority interest in a post-reorganization company with restructured senior secured debt and a balance sheet de-leveraged by hundreds of millions of dollars;
• its acquisition of Oxford Automotive for $430 million, including $200 million of new money invested and the restructuring of $200 million of bond debt and $30 million of trade debt.
• The purchaser of all the U.S. assets of PSINetin this multibillion dollar Chapter 11 case.
• United Online, Inc. in the purchase of Kmart Corporation's BlueLight Internet Service out of Kmart's Chapter 11 case.