Med Max

Division: Phoenix Management Services


Client

Med Max was a $20 million privately held national retail chain of health and beauty products and provider of durable medical equipment with operations in the Detroit, Pittsburgh and Philadelphia markets.

Problem

The equity investors were concerned about the direction and viability of this business. Additionally, the lenders were fearful that repayment of outstanding loans was in jeopardy.

Solution

Phoenix was retained to assess the situation and to advise the investors on strategic alternatives. Phoenix concluded that the client had not reached a critical mass in terms of establishing a sufficient number of institutional relationships to support its warehouse operations. Further, the significant ongoing cash drain was too high a hurdle to overcome to justify further equity investments. Phoenix was installed as interim CEO and led the Company through a liquidating Chapter 11 process, which maintained the durable medical equipment business until it could be sold. Phoenix structured, negotiated and closed the sale of assets in more than a dozen transactions under Section 363 of the Bankruptcy Code.