the secured lender held a lien on all
inventory, any in-process equipment,
raw materials, or spare parts on hand. As
a result, customers were told they would
have to re-purchase inventory to the
extent it was essential. Understandably,
this was a rude surprise for them, but
ultimately Turkington’s assets were
sold before any material transactions
with customers could take place.
Many critical orders that could
not be delayed were re-sourced
to other suppliers. Not only did
customers lose the advances they
had paid Turkington, but they also
encountered additional delays and
had to pay premiums for expedited
production with the other supplier.
Once Burned, Twice Shy?
These issues are not specific to
Turkington or the commercial baked
goods industry, and the list of issues
that brought the company down is not
complete. Time and again, companies
and their constituents have been caught
off guard by industry developments.
Brian Grant, CTP (top), is a director in the Atlanta
office of Conway MacKenzie Inc., and Graham
H. Stieglitz is a partner in the Creditors’ Rights
& Bankruptcy group in the Atlanta office of Burr
& Forman LLP. Grant provides restructuring and
business assistance to troubled companies and their
creditors on financial, operational, and strategic issues.
He has served clients in Chapter 11 bankruptcies,
out-of-court restructurings, acquisitions and
divestitures, loan workout situations, and corporate
turnarounds, and has experience across a number
of industries, with an emphasis on real estate and
manufacturing. Stieglitz focuses on commercial and
bankruptcy litigation and distressed assets M&A. He
has experience in commercial reorganizations and
workouts, and transactional and litigation experience
involving commercial transactions, receiverships,
real estate, and other business-related matters. He has
represented debtors, trustees, unsecured and secured
creditors in Chapter 11 cases, and financial institutions,
commercial lenders, and commercial lessors and
lessees in bankruptcy cases and structured loan
workouts. He can be reached at GStieglitz@Burr.com.
The issues discussed in this article
highlight the perspective, vigilance, and
forward thinking that are essential to
managing risk. Ultimately, if nothing
else, the large commercial bakeries are
likely to learn from mistakes like this and
change their behavior going forward.
Hopefully others will glean some
insight from cases like this as well. J
In restructuring, you must be ready to move
confidently in any direction. Deloitte CRG can.
We offer sophisticated planning, strategic
decision-making, deep resources, a large
breadth of services and a truly global
presence, all led by the industry’s top talent.
We can take on any restructure. And take it
anywhere. Now that’s a game changer.
Ready for any move