Winter Harbor LLC
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Lectrus Corporation

 

Lectrus Corporation (Lectrus) designed and manufactured custom metal enclosures, and provided related electrical and mechanical integrations. The Company served various businesses that operate within the oil and gas, power generation, transmission and distribution, petrochemical, and alternative energy markets. Lectrus' custom-designed and fabricated enclosures served a variety of end-uses, including: equipment centers, generator enclosures, operator centers, and enclosures that protect electrical power and mechanical control systems.

Situation

At the start of the engagement, Lectrus required an assessment of its financial condition from a professional advisory firm. The assessment would be focused on evaluating financial projections, by analyzing current project performances and the pipeline of project opportunities. Our work with Lectrus would continue into a second phase, where we were appointed as chief restructuring officer to evaluate strategic turnaround options.

Scope of Work

Phase 1

  • Analyzed and evaluated the Company’s financial projections.

    • Evaluated major drivers versus historical trends.

    • Analyzed current project performances and pipeline opportunities.

    • Identified performance improvement and cost reduction initiatives.

  • Tested the impact of certain deviations from projections and their resulting impact on financial performance and liquidity position.

  • Developed and delivered our written assessment to board of directors.

Phase 2

  • Developed restructuring recommendations which included strategic options to either retain current operations or divest operations and assets of Company.

  • Prepared Debtor-in-Possession (“DIP”) budget and negotiated DIP facility with lenders.

  • Assisted management in negotiations with key vendors and creditors.

  • Assisted the Company in filing for Chapter 11 Bankruptcy Protection in the Eastern District of Tennessee.

  • Managed estate through initial stages of wind down process.

Engagement Outcome

Winter Harbor successfully managed the operations of the business through the preparation for and filing of bankruptcy. Through a Section 363 sale process, the Tennessee-based assets (and operations) were sold to AZZ Inc., and all Houston-based assets to Metal Systems, Inc. Through this process, most employees retained their jobs. Ultimately, the estate was able to return proceeds to the Unsecured Creditors Committee for distribution to the unsecured creditors.