Lapointe International Corporation

Division: Phoenix Capital Resources, Phoenix Management Services


Client

Lapointe International Corporation was a $60 million international manufacturer of machine and machine tools based in Massachusetts. Lapointe's primary focus was on the automotive, aviation, and power generation industries.

Problem

The Company had endured an operational decline resulting in continued losses over an 18 month+ period. As a result of the Company’s complex international operations, the Company and its lenders were uncertain of the extent of the immediate liquidity requirements of the Company. The Company was requesting a modest increase in its credit lines from its bank.

Solution

When Phoenix was engaged, it was immediately clear that the basis for the ‘near term’ liquidity issue was a near complete elimination of customers in two of its core markets: aviation and power generation. The Company had used historical revenue patterns to predict future revenue; yet its backlog had been nearly depleted. Phoenix immediately went to work with the Company’s management and the Board and collectively determined that a sale through bankruptcy was the only viable option. A Phoenix associate was installed as interim CFO and the Company filed bankruptcy. Phoenix advised the Company through the 363 sale process which resulted in several bids, significantly improving the recovery for the creditors of the Company.