Welcome to the January issue of ACM Capital Partners’ Value Line newsletter. In this issue, we have detailed the case study of a successful engagement right here in South Florida. We have also highlighted a new engagement by a Florida based water company to assist them restructure their balance sheet.
ACM SUCCESSFULLY COMPLETES ASSIGNMENT FOR MERCHANTS SERVICES
Our firm was retained by Merchants Services, a very successful and rapidly growing credit card processing company located in South Florida.
The client’s quick ascent through the efforts of its founder and CEO, Mr. Chapman Ducote, essentially outgrew its managerial infrastructure. “This is a classic example of a visionary entrepreneur facing a period of rapid growth”, said ACM’s Managing Director, Jim Martin. “Supporting management that have adequate skills for a startup venture do not have broader skills sufficient to handle the growth phase.” Consequently, In February of this year, Mr. Ducote brought in ACM to review its financial systems and reporting as it was preparing to raise additional growth capital.
ACM brought in a professional team to review all facets of the financial systems including internal controls, accurate and timely financial reporting as well as a review of the company’s then capital structure and its alignment with the growth strategy. After several weeks of work, the ACM team identified key areas which needed to be enhanced. Further review and analysis identified substantial opportunity for recovery of previously charged off accounts. As a result of the recovery, ACM was able to recapture over $300,000 that had been previously written off.
In conjunction with this analysis, ACM also began negotiating with the existing debt holders to restructure the existing terms including pricing. After several months, the ACM professionals raised new capital and paid off the existing debt. The new debt came with better pricing and allowed for more flexibility for the company’s planned growth.
“The ACM team came in immediately and took charge of the right side of my balance sheet. This enabled me to focus on the operations and the growth of the top line”, said Mr. Ducote. “Once we got the debt deal closed, their professional (who had been an interim CFO) became my permanent CFO and we could not be more pleased. We are grateful to ACM for their assistance during this period.”
ACM ENGAGED BY WATER TESTING MANUFACTURER TO ASSIST WITH RESTRUCTURING DEBT
The firm announced a new engagement to assist a water testing manufacturer based in Florida. The twenty five year old company was hard hit by the Great Recession coupled with a broken international trade agreement which severely hurt earnings over a three year period. “This is a classic example of a family owned business that was financially damaged by factors outside of its control during the Great Recession,” said Jim Martin. “We look forward to assisting this family with right sizing its balance sheet.”