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Case Study: Leasing CompanyChapter 11 Trustee, Bankruptcy Consulting, Due DiligenceCompany: $400 million financial services company specializing in small ticket leasing such as automotive, health and fitness, printing and office machines.Situation / Tasks Performed: The Company grew too quickly and its operating costs resulting from this growth outstripped the Company's capital base. Bad credit policies and poor collection efforts also added to the difficulties. The Company began to take the lenders' proceeds from collections on leases and use them to fund operations, which led to the withdrawal of the borrowing facilities. The Company filed a Chapter 11 bankruptcy petition, after which TRG was hired by the Creditor's Committee to analyze the Company's financial position and to re-organize the Company's collection efforts. Results: The condition of the portfolio of leases has deteriorated so much that creditors are not likely to receive a significant dividend. Most of the portfolio assets will be used to first repay the lenders. TRG will be responsible, as Liquidating Supervisor, to manage the wind-down of the Debtor's affairs and pursue non-collection assets such as D & O claims as well as avoidance actions. Nature of Assignment: Primary:Chapter 11 Trustee Secondary: Bankruptcy Consulting Tertiary: Due Diligence Industry: Financial Services |
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© Copyright 2007 The Recovery Group, Inc. All rights reserved |
