|Business Assessment||Financial Management||Operational Turnaround||Restructuring||Specific Project||Interim Management||Insolvency||Mergers & Acquisitions|
|Paper Products Manufacturer|
|Specialty Retail Chain|
|Energy Dependent Manufacturer|
|Food Ingredients Manufacturer|
|Sporting Goods Company|
|Engineering & Construction Company|
|Contract Manufacturer of Cosmetics|
|Real Estate Investment Portfolio|
|Heavy Equipment Rental Portfolio|
|Equipment Rental Chain|
|Panolam Industries International|
|Gentek Holdings, Inc.|
|Seaspan International Ltd.|
|Prestolite Electric, Inc.|
|Wolverine Tube, Inc.|
|Atlantic Industries, Inc.|
|Enzymatic Therapy, Inc.|
$200 Million Paper Products Manufacturer
Mr. Boverman was a core member of a team that was referred to a 120 year old family-owned paper converter with $200 million in annual sales by a major lender that was considering refinancing the Company’s line of credit but found the Company’s strategic and financial plan to be inadequate. The team was engaged to perform an assessment of the Company and assist management in establishing a sound strategic plan and detailed financial projections. At that time, the Company’s earnings before interest, income taxes, depreciation and amortization (“EBITDA”) run-rate was approximately zero, annual fixed charges were $6.0 million, and there was very little undrawn availability on the existing line of credit. Substantial liquidity was created through inventory reductions and increased accounts payable, which led to completion of the refinancing.
While not required by the new lender, the Company further engaged Mr. Boverman and his associates to work with its management team to implement pricing, operating, and financial improvements identified during the assessment and Mr. Boverman continued to advise in what was effectively an interim chief financial officer role. Mr. Boverman and his associates designed and implemented detailed business plans; new customer profitability measurement; budgeting; financial reporting and accountability practices; and incentive plans. Six Sigma and Lean Manufacturing practices were adopted. Additionally, the team assisted the Company in consummating two sale lease-backs of real estate and a term loan refinancing.
As a result of these efforts, the annual EBITDA run-rate improved to approximately $7 million, fixed charges were reduced to $4.0 million and the undrawn line of credit availability increased to $10-$14 million depending on cash flow cycles. Upon completion of the engagement the chief executive officer indicated “If it were not for your efforts, I truly believe we would not be here today in a position to determine our own future.”
$250 million Specialty Retail Chain
Mr. Boverman was on a team that was initially engaged by this chain of retail outlets to conduct an independent review of the near-term cash flow forecast at the request of company’s senior lender, a major commercial bank. Product substitution and changes to traditional distribution channels for the company’s products had led to losses at the company and at other retailers in this entertainment sector.
The company provided weekly cash flow projections indicating no need for cash in excess of projected line of credit availability. Review and discussion of the assumptions made in preparing the projections identified several significant issues acknowledged by company management. After a series of discussions and analyses, the company addressed these issues and the revised cash flow forecast indicated an expected need for as much as $7 million in cash above the line of credit formulas within several weeks.
As part of the weekly cash flow review, Boverman had closely evaluated the company’s monthly income statement and balance sheet forecasts, by location and at the corporate headquarters. The company expected to suffer significant continued losses if it continued to operate in the manner it was operating. However, losses were concentrated at certain locations, inventory levels appeared excessive and other savings opportunities appeared to be available. The advisory team concluded an operating turnaround might be possible, though substantial capital would be required, including and in addition to the $7 million near term need.
The company is a wholly-owned subsidiary of a large, successful foreign conglomerate. As part of evaluating and advising the company regarding the company’s strategic and financial options, Mr. Boverman worked closely with company management to communicate with its parent company regarding the company’s situation and expectation, and the parent’s strategic and financial objectives and intentions. Representatives of the parent indicated a strong preference for the company to continue as a going concern for strategic reasons and that the parent would most likely provide the required capital if a restructuring was in fact necessary and supported by an acceptable plan.
As cash requirements began to exceed limitations on the company’s senior line of credit, its parent made intercompany loans to the company, the senior lender continued forbearance and no disruptions in treasury activities occurred.
With concurrence of the company’s parent and its senior lender, Boverman and his team were further engaged to advise and assist the company in (i) improving the existing cash flow model and assumptions to more accurately reflect the immediate and near-term cash requirements of the company (ii) developing a restructuring plan to achieve earnings levels adequate to be self-sustaining and to estimate the amount of additional capital required to achieve that goal; (iii) improving the accuracy and timeliness of the company’s financial reporting and (iv) preparation of an earnings and cash flow forecast by month for the upcoming fiscal year incorporating the elements of the restructuring plan and providing estimates of the additional capital required.
$150 million Energy Dependent Manufacturer
A manufacturing business operating in a cyclical commodity industry with $150 million in annual sales suffered dramatic losses in early 2008 as a result of high prices for energy and other key inputs without adequate selling price increases. The Company was planning to file for bankruptcy protection, which it hoped would enable it to obtain DIP financing as a bridge through what it believed might be a temporary situation in its industry and was seeking a restructuring & turnaround advisor to assist in this process.
Mr. Boverman and his associates performed an expedited assessment and suggested an alternative course of action which was adopted by management and the board. The alternative course centered around an acknowledgement a bankruptcy filing would not provide the time or liquidity for the company to operate successfully while its alternative courses of action were evaluated.
Along with the company Mr. Boverman met with the current lender and assisted in regaining credibility and an agreement for continued forbearance while Mr. Boverman managed a process to quickly identify replacement and additional financing within a very difficult capital market environment. Company management did an excellent job in managing cash closely, preventing any need for an “overadvance”.
Mr. Boverman also worked closely with the Company, the board of directors and legal counsel to closely assess all alternatives including orderly liquidation, out of court or in bankruptcy if necessary, to maximize the best outcome for all stakeholders. Because a substantial portion of the value of the company in liquidation was the expected value of its real estate, for which current market values were extremely low, it was clear that a liquidation in the near-term could yield a very poor outcome relative to the potential outcome if the company were to liquidate in a more favorable real estate environment.
Mr. Boverman worked closely with management to update the company’s projections and to prepare an information memorandum and due diligence materials and contacted over sixty prospective lenders on behalf of the company. To provide the capital required until the new financing could be secured, the company deferred over $5 million in payments to its primary energy supplier, fully explaining the circumstances and alternatives, without impacting service. Despite worsening capital market conditions, Mr. Boverman was able to obtain several proposals which while expensive would have provided the company with the funds needed.
However, energy prices remained extremely high and as a result the company’s projections were for substantial continued losses for the foreseeable future unless market conditions improved. While the prospective new lenders were fully aware of the situation and were relying primarily on asset values, discussion of financial covenants made it clear that if the financing was completed, there would be a very high probability of default under new financial covenants and that the new lender would force a bankruptcy filing and most likely liquidation. Given the much worse cash collateral position the company would be in if it liquidated soon after the refinancing relative to liquidating without refinancing, and the low value expectations if assets had to be sold without adequate time, proceeding with the refinancing was deferred.
As the new financing was being pursued, the Company implemented an energy surcharge to its customers and substantial cost reductions. Energy prices then declined dramatically and as a result, assisted by the other actions taken, the company began to anticipate substantial operating profits. The refinancing process was resumed, a new non-bank lender was selected and successfully completed due diligence, but then informed the company that it did not have the capital to close the transaction due to market conditions impacting its capital sources.
Throughout the engagement, Mr. Boverman and company management met regularly with the company’s senior lender, a major commercial bank, keeping it completely informed of its evolving plans, results and expectations. This lender agreed to continue to work with the company provided advances remained within borrowing base limits and a satisfactory modification of the existing terms for the deferred energy vendor payments could be obtained. While an arrangement was agreed, the company continued to suffer from declines in demand for its primary product.
$100 million Food Ingredients Manufacturer
Mr. Boverman led a strategic, financial and operational assessment of this 60 year old food ingredient manufacturer at the request of one of two lenders which were providing the company with $40 million in debt facilities. The company processes fruit crops and had suffered from three poor crop years within a five-year period, generating losses and covenant violations and consuming most of its line of credit availability.
The assessment was performed on an expedited basis and the findings were presented to the company and then to the referring lender. Boverman found the company was clearly a sustainable and well managed business, with very qualified management, solid marketing strategies, customer relationships, supply chain, operating and financial practices. A list of specific questions and concerns provided to the company by the referring lender was addressed to the satisfaction of the lender.
However, Boverman advised the company that its debt level was too great given inherent uncertainty of cash flows, including the highly seasonal and cyclical nature of its business. Boverman also advised that given the size and sophistication of its major customers and the increasingly global nature of this business sector that the company would have much better long-term prospects if it was to sell to or merge with another business. The company was also the sole significant asset of its shareholder who had indicated a desire for liquidity within seven years.
While the poor recent results made timing for a sale less than ideal, Boverman recommended the company engage an investment banker to carefully identify and approach the most logical strategic buyers. If valuations or terms expressed were not found to be satisfactory, Boverman recommended the company sell a minority interest to a party who would be likely to acquire the balance of the company at a later time, and hopefully at a greater valuation, and use a substantial portion of the proceeds from the minority interest to improve liquidity. The company did engage an investment banker shortly after the assessment was completed. Approximately one year after completion of the assessment the company was sold to a strategic buyer.
$50 million Sporting Goods Company
Mr. Boverman led a strategic, financial and operational assessment of this designer, importer and distributor of sporting goods at the request of its senior lender, a major commercial bank. The company had enjoyed many years of growth and moderate profitability, first as a contract designer, and later creating its own line of branded products. Growth was still occurring. However, the company was selling six different product lines through separate distribution channels, without having a leading or very significant share of the market in any of them. Losses and cash consumed by excessive inventories created covenant violations and lack of liquidity. Relationships with its Asian manufacturers were becoming strained and the possibility that letters of credit could be required to secure purchase commitments was a very serious threat to the company’s viability.
Boverman and his associates found that while clearly a successful and creative company with good prospects in certain of its channels, the company needed to concentrate and prioritize its efforts in the most promising areas. The overarching recommendation was for the company to better understand customer and product profitability and to recognize this in all decisions. In addition to recommending rationalization of the number of product lines by discontinuing or licensing these to others, the assessment report provided many specific areas for improvement in operations, including return on investment analysis of each product; identify and eliminate loss transactions such as small shipments; improved communication and accountability among sales and operation to improve inventory management; modification of sales incentive plans to emphasize margin not volume; rigorous justification of all employment positions and improved budgeting and forecasting
Boverman also concluded that the company’s capital structure was inappropriate given its strategic plans for growth and lack of liquidity. The company’s existing line of credit was expiring within several months, and there were five other short-term notes payable to individuals. There was no strategy in place to finance repayment of the short-term notes and it was clear that adequate liquidity to repay these would not be generated by operations, or that the line of credit lender would permit these payments. The company also desired to launch a new completely unrelated product in the furniture sector which it believed had very attractive prospects but clearly did not have the financing for this. Boverman recommended the company develop a strategy to recapitalize, perhaps with a strategic partner with whom discussions had commenced, or through a carefully planned process to identify an appropriate strategic or perhaps financial partner or buyer. Or at a minimum to arrange to renew or refinance its line of credit seeking a 3-5 year term and to extend the maturity dates of the other notes to be coterminous with the line of credit.
The principal stockholder and his management team agreed to implement most of the recommendations made and the company continues to operate as a going concern.
$200 million Manufacturing Division
Mr. Boverman and an associate joined a larger team executing a turnaround of a $1.5 billion agricultural company to perform an investment banking role with regard to the potential sale of a $200 million core manufacturing division. Boverman’s contributions included expediting preparation for due diligence by a very sophisticated logical strategic buyer which was completed ahead of schedule. He then worked closely with the client and legal counsel to negotiate a complex purchase agreement and related joint venture.
These efforts enabled the client to demonstrate to its lenders that the division did have substantial value that could be monetized rapidly, assisting in the successful negotiations to prevent foreclosure while the operating turnaround of the business as a whole was successfully completed. The company was then able to convince the bank group that the division could and should be retained and declined to proceed when the potential buyer attempted to substantially modify previously agreed terms for the sale of the division.
$450 million Engineering & Construction Company
While with Huron Consulting Group, Mr. Boverman was part of the team that advised a publicly traded company that builds above ground storage tanks, repairs and maintains facilities such as chemical plants, refineries and other infrastructure for industrial clients from coast to coast. Mr. Boverman helped its Western Division develop improvements in operating practices to increase operating profits and reduce loss contracts, developed financial projections for the turnaround of its Eastern Division; advised regarding cash flow for the Company as a whole and prepared presentations for the lending group regarding the turnaround. This company avoided bankruptcy and its stock price more than doubled following the engagement.
$55 million Contract Manufacturer of Cosmetics
Mr. Boverman was on a team that was engaged by a private equity group to arrange new subordinated debt for a portfolio company that formulated and manufactured shampoo and other cosmetic products for a wide range of small and Fortune 500 customers. The business had been built to a meaningful scale by its founders, but suffered substantial setbacks when new managers were brought in and the company unsuccessfully attempted to take on additional lower margin products for sale to customers including Walmart, entering into a long-term lease on a facility with approximately four times the capacity required for the core business and substantially increasing fixed costs. Additionally, its controller had been found to have intentionally misstated financial results, overstating inventories by an amount exceeding expected profit for the preceding year. The company’s CEO, its COO (who had been CFO) and its current CFO claimed they were unaware of the misstatement of results.
Within several days of beginning due diligence with respect to seeking the new financing Mr. Boverman and his associates suggested an emergency board meeting be held, at which it was made clear to the board and private equity group that given the current cost structure and attributes of the core business an operating turnaround was not feasible, or at least not without very substantial additional funding which was unlikely to be obtainable. The board was also told that while the board may believe in and support the senior management team with respect to the financial misstatements, no new lenders should be expected to do so. The board was advised that the company was likely in the “zone of insolvency” and was advised to engage bankruptcy counsel.
The company engaged a law firm recommended by Mr. Boverman and his associates. Mr. Boverman was appointed interim CFO of the company. Due to the strength and nature of the core business itself, analysis indicated that it was likely that the business could be sold to a strategic buyer for value substantially in excess of the value that might be obtained from liquidation of the individual assets. As such, the company engaged a prominent investment banking firm recommended by Mr. Boverman and his associates to advise regarding the sale. A sale to a strategic buyer was consummated within several months at an attractive value, with the business relocated to the buyer’s facilities and the company facilities were closed in an orderly manner.
$90 million Real Estate Investment Portfolio
While with Huron Consulting Group, Mr. Boverman led a team of four that conducted an expedited analysis of a complex group of approximately 20 partnerships associated with five condominium projects in various stages of development. The client was a law firm representing a foreign investor that had provided most of the over $40 million in equity capital invested in partnerships with a U.S. real estate development and management company acting as general partner. The assignment was to assist in making an informed business decision relative to a possible change in the developer / general partner; whether to advance new capital to some or all of the partnerships, and to investigate certain transactions relative to the sources and uses of funds within and between the various parties in interest.
To obtain a thorough understanding of the rights, responsibilities and related party relationships of each entity Boverman and his team involved and reviewed all partnership agreements, management contracts and all documents related to approximately $50 million in debt owed by the partnerships to various lenders. Financial transactions by each entity from inception were examined for compliance with the agreements among the parties, with particular focus on capital calls, capital account transactions and related party transactions such as management fees. This work identified 24 transactions or entries with a total value of $15.5 million that were of interest to our client and the foreign investor involved. The most significant items were entries increasing the developer’s capital account totaling $5.3 million that may not have been previously understood by our client and the foreign investor to represent capital commitments and not cash contributions.
Mr. Boverman conducted extensive interviews of development company executives to obtain an understanding of each development project including, size, costs, market history and prospects, the developers current activities and intentions for the business prospects, expected completion costs and timing, related debt and status thereof and expected values once completed. Boverman prepared an analysis of estimated costs to complete each project, estimated valuations if completed and incremental value that might be expected to be returned to each investor involved if completed. The advice the engagement team delivered was that there appeared to be significant risks associated with four of the projects as to outcome given the length of time needed for completion, current real estate and capital market environments, and inflationary pressure on certain commodities related to construction that were anticipated at that time.
The client reported the results of this work were very helpful in achieving and acceptable agreement among the parties on how to proceed with each project without litigation.
$100 million Heavy Equipment Rental Company
Mr. Boverman was on a Huron Consulting Group team engaged by a law firm advising a major commercial lender with regard to this rental company focused on heavy commercial construction equipment. The business was over 35 years old and had been recently sold by its founder to a financial buyer for over $100 million, with the founder’s son remaining as CEO. The business had focused on residential construction for which demand had fallen dramatically in its multi-state markets and there was little indication of coming recovery. The equipment rental fleet had been substantially leveraged under senior debt facilities provided by the commercial lender which arranged Huron engagement along with two other major commercial lenders who were participants, and appraised values of the equipment had recently declined significantly indicating that the lending group would clearly suffer substantial losses in event of a liquidation of the business. The company stockholders had declined to provide additional capital several times having apparently already concluded the over $20 million in equity that had been invested less than 18 months previously no longer had any value.
The team began to work closely with the lending group in evaluating the situation, reacting to specific matters as they arose and advised regarding related decisions. Despite strong resistance from the company and its lenders, Mr. Boverman and the Huron team worked with company managers and with third-party information to perform an assessment of the company, its markets, competition, equipment utilization and rental rates, operating costs including the status of maintenance and logistical controls over the fleet, historical and projected financial results on a combined basis and by location and cyclicality and seasonality thereof. Based on the fundamental nature of the decline in residential construction, the high-level of competition and commoditization in the equipment rental industry, the low utilization for heavy equipment regionally and nationally which was driving down rental rates and making purchase of used equipment more attractive as an alternative to renting, and other factors, the team concluded that the company could not survive independently as a going concern, and recommended a sale or liquidation. Given its assessment of the skills and objectives of the mangers in place at the company the team recommended the lending group require a chief restructuring officer be appointed immediately to provide greater assurance that the company would be managed appropriately, Huron being conflicted from assuming this role by virtue of the existing engagement by the lenders. A sale of all or portions of the business or its assets as a going concern at a value greater than a sale of the assets individually was considered possible though not likely. An expedited sale process was conducted while the value of liquidation was further confirmed. Mr. Boverman advised the lending group in negotiating the terms of an agreement with an investment banker with very clear milestones and low financial risks in event an attractive transaction was not identified, though that effort did not result in an attractive alternative and the company’s assets were liquidated.
$30 Million Food Manufacturer
This 60 year old private-label juice manufacturer had suffered financially over time from the prevalence of imported juice concentrate and consolidation in the grocery industry. Mr. Boverman was on a team engaged by the after the company after it had exhausted its liquidity under its line of credit with a major commercial bank and had filed for protection under Chapter 11 of the U.S. Bankruptcy code. In addition to working with company management with respect to various matters in connection with the bankruptcy including cash flow, reporting and other financial and operating management, the team completed an assessment of the business to determine what aspects of the company’s operations and financial expectations could be improved, whether there was likely to be going concern value in excess of estimated values for liquidation of its underlying assets and the cost of continuing to operate during any sale process. The company had unsuccessfully engaged an investment banker to pursue a sale not long before and there were no apparent strategic or other likely buyers of the business. Prompt cessation of operations and liquidation of the assets was the course that the team advised and was being executed. However, during that process a buyer was identified which had unusual strategic interest and was willing to purchase of the business in its existing form under terms that were attractive relative to the anticipated range of values of a liquidation of the assets individually and as such the business continues to operate.
$50 Million Equipment Rental Chain
This company was relatively well managed and there was high demand for equipment rentals in its marketplace due to construction levels that were expected to continue to be high for the foreseeable future. Its primary problem was that rental rates for larger equipment had decreased dramatically. This was attributed to fierce competition among the largest rental companies, two of which were essentially “roll-ups” with high debt service requirements. The other significant problem was the company had purchased excessive equipment during the preceding year, using substantially all of its collateral to do so and also incurring substantial unsecured debt.
The Glass & Associates team Boverman was part of developed an out-of-court restructuring plan and with the concurrence of the senior lender proceeded to meet with other creditors to obtain their approval for the plan. Unfortunately, one significant unsecured lender would not agree to the proposed plan or any acceptable variation, compelling the company to file under Chapter 11. Mr. Boverman and his associates advised the company on all strategic, operational and financial matters during the bankruptcy process and in developing the restructuring plan that was ultimately approved by the court. The lender that objected to the out-of-court plan realized far less than had been offered in that plan.
$50 million Electronics Manufacturer
Mr. Boverman was part of a team that advised this family-owned company as it struggled to operate under severe liquidity constraints while evaluating its strategic options. The company manufactured for the consumer and professional music markets. Once a technology leader and innovator, the company had evolved toward commodity products. Consolidation of its customer base led to increased power for its largest supplier, reducing selling prices and increasing credit terms. At the same time, most competitors had moved manufacturing to Asia while the company continued to manufacture almost all of its products in the U.S.
The Glass & Associates team Boverman was part of established strict controls over operations and cash flow, but it was clear that the company would not be able to restructure and survive on its own. The company was advised to conduct and expedited sale process while closely communicating with all stakeholders regarding that process and realistic expectations for outcome and avoiding the direct and indirect costs of a bankruptcy filing if possible. Mr. Boverman and his associates carefully managed cash and worked with vendors closely to secure goods and services to continue production and timely deliveries to customers and assisted the company in selecting an investment banking firm and with the sale process. The company was sold to a strategic buyer for substantially more than its liquidation value.
Panolam Industries International
While at Genstar Capital Partners Mr. Boverman led the acquisition of this manufacturer of thermally-fused melamine panels from Domtar, Inc. and arranged $100 million in senior and subordinated debt facilities for the acquisition. Mr. Boverman worked closely with Panolam’s management team to develop growth, cost reduction, facility consolidation strategies and other plans for the new company. Mr. Boverman served as a director of Panolam thereafter representing Genstar and, as required by the lead lender, served as Panolam’s chief financial officer for the first six months following the acquisition.
Prior to being offered for sale as one division Panolam had operated as five separate business units located across the U.S., one of which had been recently acquired and was still using its own operating and financial systems. Boverman led creation of stand-alone business and financial systems for the new company as it transitioned from operating as Domtar units and hired a CEO and CFO and established other new corporate functions, including treasury; corporate accounting; marketing; business development; human resources; logistics and information systems.
Panolam was sold to The Carlyle Group in 1999 for a very substantial gain and later re-acquired by a subsequent Genstar Capital Partners affiliate.
Gentek Holdings, Inc.
Mr. Boverman was on the Genstar Capital Partners team that arranged to acquire the US and Canadian building materials manufacturing and distribution division of Alcan Aluminum Inc. for $125 million, based upon a turnaround plan. Mr. Boverman worked closely with Gentek management to reorganize 16 manufacturing plants and over 50 distribution centers into one business, restructure the health care plan for substantial savings, rationalize manufacturing capacity for declining products, expand capacity for growth products including vinyl windows, establish a new head office function including corporate governance practices and executive functions and to recruit a CFO and corporate controller. Gentek was sold later sold to strategic buyer Associated Materials Inc. for a significant gain.
Seaspan International Ltd.
Mr. Boverman was on the Genstar Capital Partners team that arranged to acquire a marine transportation and shipyard company for Cdn. $120 million. At the time of the acquisition Seaspan operated approximately 250 barges and 50 tug boats for coastal and ocean going services and was very well-managed with few significant issues. Seaspan was sold several years later at a substantial profit to a competitor who had been invited to co-invest in the Seaspan acquisition.
Prestolite Electric, Inc.
Mr. Boverman was on the Genstar Capital Partners team that arranged to acquire Prestolite for $40 million out of Chapter 11 when it was in essence breaking even on a cash flow basis. Prestolite manufactures alternators and starter motors, primarily for the heavy-duty truck and military vehicle markets. Developed and implemented a restructuring that reduced the break-even sales point by 45% at a cost of $12 million. Thirteen manufacturing facilities were consolidated into six facilities. Prestolite was sold in to First Atlantic Capital in 2004 for a very significant gain.
Wolverine Tube, Inc.
Mr. Boverman was on the Genstar Capital Partners team that arranged to acquire this manufacturer of proprietary copper tube used primarily for air conditioning applications with annual sales of almost $500 million. Mr. Boverman was involved in strategy setting, capacity expansion for specialty products; rationalization of capacity for other products and a substantial capital project to reduce production costs. Worked closely with investment banks with regard to a $100 million high-yield bond offering to finance expansion and cost reduction programs; an initial public offering of common shares; and a secondary offering of Genstar’s remaining stake in the company at a very substantial gain.
Atlantic Industries, Inc.
Mr. Boverman was on the Genstar Capital Partners team that arranged to acquire this manufacturer of military products employing 250 people acquired from entrepreneurial founders. Mr. Boverman spent almost half time on site for two years acting as CFO in a turnaround environment. Recruited new CFO and other executives; established professional financial and corporate governance practices; implemented modern costing system where none had existed. Restored business to historical margins and profitability.
Tyler Encapsulations, Inc. / Enzymatic Therapy, Inc.
In 1997 Mr. Boverman was recruited to Tyler Encapsulations, Inc. to bring this entrepreneurial business to the next level and obtain capital for continued growth. Tyler was a developer, manufacturer and marketer of ethical dietary supplements (“nutraceuticals”) sold primarily through alternative healthcare practitioners such as Naturopathic Doctors and through Medical Doctors. In addition to substantial operating and financial contributions, Mr. Boverman developed an industry sector consolidation strategy that led to the sale of Tyler into a merger and recapitalization with three other companies resulting in combined sales of ten times those of Tyler, now known as Enzymatic Therapy, Inc.
– Initiated strategic planning process that changed direction of the company.
– Extensive hands on operating experience in all business activities.
– Refocused and participated in sales and marketing.
– Established internal financial reporting, budgetary controls and other practices for first time at the company.
– Managed spending very closely in order to maximize growth with limited capital.
– Increased bank financing by over 50% to fix an inherited liquidity problem.
– Extensive negotiations on licenses and other intellectual property issues.
– Identified entrepreneurs with whom a consolidation strategy was developed for the industry sector.
Mr. Boverman indentified North Castle Partners, a private equity group based in Greenwich Connecticut, as an ideal investor given its focus in alternative health care and arranged $30 million in equity financing from North Castle, as well as $60 million in senior debt financing and $15 million in subordinated debt for the four-way merger and recapitalization. Prior to and following consummation of the merger and recapitalizations Mr. Boverman worked closely with North Castle Partners and Bain & Co. to complete and expand the practitioner channel consolidation strategy and other strategic matters. Mr. Boverman was appointed CFO of the combined companies, Enzymatic Therapy, Inc.
– Originated the brand “Integrative Therapeutics, Inc.” under which four practitioner brands were combined.
– Near term focus on integrating the companies, communications, and operating practices.
– Responsible for coordination of purchasing synergies throughout the company.
– Extensive recruiting to facilitate growth, including sales management, sales, finance, and information technology.
– Shareholders realized substantial gains on sale of Enzymatic to a strategic buyer.