Special Situations and Debt Restructuring in the Printing Industry

Graphic Arts Advisors, LLC, M&A advisors and consultants to owners, lenders and investors in the printing, mailing, packaging, digital advertising, and graphic communications industries, is pleased to present a conversation with John Hyde, Esq., Managing Director of Special Situations, the leading expert in M&A involving financially-challenged companies in this marketplace.

Q: Your colleagues at Graphic Arts Advisors and others in the printing industry say that market conditions are currently positive for mergers and acquisitions. Do you agree?

JH: Yes, the current M&A marketplace is robust for businesses sold as a going concern or as a tuck-in. In most cases, buyers are placing significant value on the intangible assets such as customer relationships, the book-of-business, market presence, qualified and trained employees, and functioning infrastructure with installed equipment up and running.

Q: What does this mean for owners and investors of companies that find themselves financially “upside-down,” owing more in debts than they can reasonably pay off? JH: If the company’s assets are worth less than what is owed to creditors, then the owners or investors face lousy options such as using personal savings to pay the shortfall, slog it out in bankruptcy court, abruptly walk away with resultant reputational harm and risk of legal action, or negotiate amicable and fair debt settlements in a structured process outside of bankruptcy court. The latter option, often known as non-bankruptcy debt restructuring, is usually less painful than the other more extreme measures. Non-bankruptcy debt restructuring is ideally suited to owners and investors of financially-challenged companies who prefer to achieve a graceful transition that is amicable for customers, employees, suppliers, lenders, investors, partners, and landlords. Q: What do you mean by “restructuring”? JH: Restructuring is the art and science of substituting one obligation for another. It often involves a process designed to negotiate fair settlements with creditors as part of a comprehensive plan.