The 15th Annual Turnaround Awards by The M&A Advisor have recognized Lowenstein Sandler for four significant transactions completed during 2020. Participation by members of the firm’s Bankruptcy & Restructuring Department was noted in the following matters:
- The restructuring of GNC was named Cross-Border Restructuring of the Year ($500MM to $1B). Led by partners Jeffrey Cohen, Chair of the Bankruptcy & Restructuring Department, and Michael S. Etkin, Lowenstein represented the Unsecured Creditors’ Committee of GNC Holdings, Inc., a leading global specialty retailer of health and wellness products for 85 years, in the successful negotiation of a plan of reorganization in the U.S. Bankruptcy Court in the District of Delaware, including the sale of the GNC business as a going concern. At one point, GNC operated approximately 5,200 retail locations in approximately 50 countries. The consensual resolution with the debtors, secured lenders, unsecured noteholders, and the purchaser resulted in a substantially increased recovery and other meaningful benefits for unsecured creditors. The court commended all parties for their significant efforts in reaching consensus with respect to a complex case under extremely difficult circumstances.
- The restructuring of the assets of Yueting Jia and Faraday Future was cited as the Cross-Border Restructuring of the Year (Over $1B). Chinese entrepreneur Jia, founder of Faraday Future, a global, shared intelligent mobility ecosystem company that designs and engineers next-generation smart electric connected vehicles, completed a $3.5+ billion reorganization by contributing all of his stock in Faraday Future to a trust for the benefit of his creditors. Under the plan confirmed in May 2020 in the U.S. Bankruptcy Court for the Central District of California, Jia's creditors could recover 13 percent to 62 percent of unsecured debt claims, estimated to be between $3.5 and $7.9 billion. In July 2021, Faraday Future merged with Property Solutions Acquisition Corporation, a publicly traded special purpose acquisition company (SPAC). Following the merger, FFIE is being traded on the Nasdaq (Nasdaq: FFIE). The Lowenstein team was led by Jeffrey D. Prol, Vice Chair of Lowenstein’s Bankruptcy & Restructuring Department, and Lowenstein partners Andrew Behlmann and Michael A. Kaplan. Prol currently serves as the trustee of the Founding Future Creditors Trust, a significant shareholder in FFIE. Behlmann and Kaplan represent the Trust and were actively involved in the SPAC merger process.
- The approximately $140 million sale of virtually all assets of Rubie’s Costume Company, Inc. and its U.S.-based subsidiaries and affiliates in October 2020, effectuated through a Chapter 11 Section 363 process in the U.S. Bankruptcy Court for the Eastern District of New York, was named Distressed M&A Deal of the Year ($100MM to $250MM). Rubie’s is the world’s largest costume provider, with a wide-ranging portfolio of licensed products, including Marvel, Warner Brothers, Nickelodeon, Disney, and Lucasfilm costumes, memorabilia, novelties, and toys. In need of immediate funding to prepare its 2020 Halloween inventory, Rubie’s determined that filing for protection under Chapter 11 would allow it to secure the funding necessary to continue operations. A proposal by Lowenstein client JMB Capital Partners Lending, LLC was found to be the best offer in a post-petition process to secure DIP financing as a bridge to an exit from bankruptcy. The DIP facility was approved after two contested hearings and provided $45 million of post-petition funding, enabling Rubie’s to meet critical deadlines for the Halloween season. Robert M. Hirsh and Phillip Khezri served as counsel to JMB Capital Partners, the DIP lender in the sale.
- The sale of Talalay Global was named a Cross-Border Section 363 Sale of the Year. Lowenstein represented the Official Committee of Unsecured Creditors in the bankruptcy cases of Latex Foam International (aka Talalay Global), the largest producer of Talalay in the world and the only manufacturer in the United States of premier foam mattresses, components for foam mattresses, pillows, and toppers. As counsel to the Committee, the firm was involved in addressing the company’s financial and operational needs and worked closely with the debtors and their advisors to achieve a successful sale of the business to Belgium-based Artilat, NV. The sale resulted in the preservation of all jobs and repayment in full of secured debt. Following the sale, the Committee proposed and, by order of the U.S. Bankruptcy Court for the District of Connecticut on November 12, 2020, achieved confirmation of a plan of liquidation. The Lowenstein team included Wojciech F. Jung, Mary E. Seymour, and Colleen M. Maker.
The M&A Advisor’s Turnaround Awards recognize those that have reached the pinnacle of the distressed investing, bankruptcy, and restructuring industry over the past year. Evaluation of the nominees and selection of the winners was completed by prominent members and experts in the M&A, finance, and turnaround community. The awards will be presented at a gala dinner celebration during the 2021 Distressed Investing Summit in New York City on Wednesday, September 29, 2021.
Founded in 1998, The M&A Advisor has built a leading global network of M&A, turnaround, and finance professionals across domestic and international deal-making. Recipients of its prestigious awards are among the most respected financial professionals around the world. During the past two decades, The M&A Advisor has established a legacy of showcasing emerging leaders, connecting pillars of the profession, and recognizing achievement throughout the community.
About Lowenstein Sandler LLP
Lowenstein Sandler is a national law firm with over 350 lawyers based in New York, Palo Alto, New Jersey, Utah, and Washington, D.C. The firm represents leaders in virtually every sector of the global economy, with particular emphasis on investment funds, life sciences, and technology. Recognized for its entrepreneurial spirit and high standard of client service, the firm is committed to the interests of its clients, colleagues, and communities.
Stephen J. Kimmerling
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Lowenstein Sandler LLP
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