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SC&H Capital Advises A.C. Furniture Company, Inc. in its Sale to Multiple Buyers
October 8, 2020
Source: SC&H Capital
SC&H Capital, a leading investment bank specializing in M&A advisory, announced it acted as the exclusive investment banker to A.C. Furniture Company, Inc. (“A.C. Furniture” or “the Company”) in the sale of its equipment, inventory, and some of its real estate assets to Linon Home Décor Products, Inc. (“Linon”), a New York Corporation. Other real estate parcels were sold to Blue Empire, LLC, and Holland Industrial Group.
Following a steep downturn in revenues, A.C. Furniture, a custom manufacturer of commercial seating products, filed for Chapter 11 bankruptcy protection on February 3, 2020. Soon after, A.C. Furniture petitioned the bankruptcy court to engage SC&H Capital to explore strategic options for the Company, and on March 24, 2020, SC&H was approved to market A.C. Furniture for a sale. SC&H conducted an extensive marketing process culminating in a final bid-off among qualified bidders on July 21, 2020. Early in the process, during the height of the Covid-19 crisis, the Company shuttered its operations. SC&H continued to market the business and, trying to attract as many buyers as possible, offered each of the five real estate parcels, inventory and intellectual property, machinery and equipment, and accounts receivable as separate bid lots and in various combinations. At the conclusion of the auction, Linon, a strategic buyer for the business, was the successful buyer of three of the five real estate properties and all the inventory and equipment and intellectual property. Holland Industrial was the high bidder on A.C. Furniture’s headquarters in Axton, Virginia, and Blue Empire was the successful bidder for a second property in Axton.
Fred Cross, Principal at SC&H Capital, said, “The COVID-19 pandemic has changed the world we live in. Despite the pandemic, SC&H was able to market the business during a time when virtually every customer of A.C. Furniture was shutdown. Although we did experience a slight delay to allow buyers time to travel to A.C. Furniture to inspect the business and assets, that delay was limited to only 30 days. Nine bidders participated at a live auction, which produced more than 35 bids and nearly a twofold improvement on values from the start of the auction. Our success, in this case, can be attributed to SC&H’s tenacity to persevere through what has been one of the most disruptive economic and social periods in American history.”
The Company had historically been one of the country’s largest contract manufacturers of seating for the hospitality, healthcare, and foodservice industries. It had been in continuous operation since its inception in 1977. At its peak, A.C. Furniture employed more than 400 skilled craftsmen and had revenue in excess of $50 million. While headquartered in Axton, Virginia, the Company also had three other plants located a short distance away in Eden, North Carolina.
Other professionals who worked on the transaction include:
• William Callahan, Gentry Locke Rakes & Moore, LLP, Chapter 7 Trustee
• Peter Pearl and Lori Thompson, Spilman Thomas & Battle, PLLC, counsel to SummitBridge National Investments VI, LLC
• Rich Maxwell, Woods Rogers, PLC, counsel to Bank of The James
• Andy Goldstein, Magee, Goldstein, Lasky & Sayers, PC, council to Thoroughbred Holdings (related entity which owned one of the real estate parcels)
• David Baker, Laura Kendall, and John McGee, Aurora Management Partners, Chief Restructuring Officer for the Debtor
• Robert Boghosian, Cohen, Tauber, Spievack & Wagner, PC, council to Linon Powell
About SC&H CapitalSC&H Capital, an affiliate of SC&H Group, is an investment banking and advisory firm providing merger and acquisition (M&A), special situation, employee stock ownership plan (ESOP), capital raising, and business valuation solutions to middle-market and growth companies nationwide. SC&H Capital delivers investment banking and advisory services across numerous industries, including technology, healthcare, manufacturing, and government contracting, to help owners achieve their exit planning goals and liquidity objectives. To learn more, visit www.schcapital.com.
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