Case Study:

Rennie Petroleum Corporation - Corporate Recovery

Situation

• Matrix was engaged by the debtor to manage the sale of the retail and dealer assets of Rennie Petroleum Corporation.
• At the time of engagement, Rennie was already operating under Chapter 11 bankruptcy protection, and both the secured and unsecured creditors agreed that a sale of the assets would maximize returns to all of the stakeholders.

Objective

• Due to the Company’s negative cash flow, the stakeholders sought a sale process that would result in the highest recovery in the shortest time frame possible. Matrix crafted a sale process that would result in a solicitation of offers in approximately 8 weeks.

Solution

• After Bankruptcy Court approved of the Sale Procedures, Matrix marketed the assets to over 175 strategic and financial buyers and invited them to participate in a live auction format that allowed prospective bidders to bid on individual stores, multiple stores or on the entire chain.
• The process that we created and executed resulted in 16 qualified bidders attending an auction for the assets and several rounds of competitive bidding, which were instrumental in maximizing the recovery to the creditors, as a significant percent of the recovery resulted from topping bids.
• Matrix’s sale process and execution in an extremely expedited pre-marketing and marketing timeline, resulted in a sale of the assets for approximately $4.2 million to Zota Petroleums, a 4.5 multiple of 2006 Store EBITDA, and an impressive multiple when considering that the assets sold were two fee stores, 22 leaseholds, and five supply agreements.