O'Sullivan Industries interim CEO Rick Walters signed off on the proposed reorganization plan and says no liquidation is in the offing for the company.
According to documents filed Wednesday in U. S. Bankruptcy Court for the Northern District of Georgia, Walters said, "Based upon my personal knowledge of the plan, absent severe, unique, and unexpected circumstances, I do not believe that confirmation of the plan is likely to be followed by liquidation or the need for further financial reorganization of the debtors or any successors thereof. There is a reasonable prospect that the debtors will meet their financial obligations under the plan, and I believe that the plan is feasible."
At the same time, a liquidation plan is included in the plan and Walters says he believes "it presents an accurate picture of the realities of a potential liquidation scenario of the debtors' assets."
Under the plan, O'Sullivan Industries, which entered Chapter 11 bankruptcy with $250 million in debt, will emerge from it in the near future with approximately $46 million in debt, and will have a new line of credit of up to $50 million "and a business plan that would allow (the company) to generate significant cash flow in their first year post-emergence and to grow EBITDA to approximately $13.7 million in fiscal year 2007."
The plan would enable O'Sullivan Industries to continue "to operate as a viable entry," Walters said.
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A newly-configured board of directors for O'Sullivan Industries has been proposed, but is being kept from the public and is not included in the open documents in U. S. Bankruptcy Court.
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The Lamar Democrat reports the company is settling its outstanding debt to the city of Lamar for 17 cents on the dollar. Nothing like maintaining a good neighbor policy.
7 comments:
Randy:
Wake up! Rick WALTERS is the interim CEO. Rick Davidson is the deposed CEO! Rick Davidson was tarred and feathered enough two years ago. Since I was on Rick Davidson's management team, I will maintain that his biggest flaw was that he cared too much about everybody right down to the lowest paid person in the company. In fact, in my opinion, that is probably the best way to differentiate between the two Rick's.
It is funny how the bankruptcy documents say how critical Rick Walters is to the success of the company due to the respect he has from the rank and file and his relationships with vendors. Ask each group whether they are better off now than they were with Rick Davidson.
Randy
The new Board of Directors is available as Docket #500. Proposed Board is Rick Walters, interim CEO, Michael Ranson and Tom Shandell from Goldentree - the bondholders who will get most of the equity, Eugene Davis - who specializes in corporate turnarounds and sales, and James Malone - who also specializes in turnaround and crisis management.
There are 2 very interesting things about this proposed Board. First, where is "million-dollar" Bob Parker. Second, the presence of the turnaround guys calls into question future changes and must make Walters and the rest of the Sharpie tag-alongs not sleep well at night!
Thanks for the information. And to the earlier poster, you are absolutely right. I had it Davidson in the headline and in a couple of spots in the story and had it Walters elsewhere. I need to be more careful when I write that early in the morning and make sure I am awake.
Wake up! Parker inherited R.D.'s mistakes/problems. As a whole, company better prior to R.D.!
Parker probably not coming back.
Some Newell/pen guys have already run and will continue to flee!
Isn't Parker the on who had the "stroke"? And hasn't been heard from since?
If I am not mistaken, when Parker took over, O'Sullivans sales were over $300 million and EBITDA was over $35 million. While there may have been problems when Parker and Walters came in, for you to support them is ludicrous. And for Walters to be bragging about 2007 EBITDA of $17 million compared to little if any in 2005 is equally appalling!
Parker and Walters are the ones who dismantled the Company and treated all they dealt with like trash.
Gotta tell ya anonymous that I sat through both regimes (until I was determined to be "no longer needed" by Mike Orr), and while you might think you know it all, you don't! I spent a whole lot more of my time under Parker trying to keep sand out of the gears when Mike would make "decisions". Rick Davidson can be accused of not making the requisite changes in the organization, but this group made changes just to stuff it with cronies.
This company is not beyond salvage, but it will need effective management, not the hubris laden clan that now (over)staff it from Newell!
Whereas Rick D. didn't like to hurt anyone, these guys always impressed me as the type who pulled the wings off of flys!
All that said, I wish the best for those who remain in the organization. You are good people and you deserve better!
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