Maybe this could help with a sale.
MINNEAPOLIS, Jun 26, 2000 /PRNewswire via COMTEX/ -- Verdant Brands has retained the services of the investment
banking firm of Goldsmith, Agio, Helms, & Lynner, Ltd., to assist the Company in pursuing the sale of its retail business. "Despite
the operational difficulties we have experienced, our retail brands are strong in the marketplace," said Bruce Mallory, President
and COO. "In particular, the Safer brand is in its second consecutive season of double-digit growth. Because the Company
currently has inadequate capital to invest in the brand-building activities and infrastructure that this business requires to operate
successfully, a sale of the retail portion of Verdant's business is being explored as a way of maximizing shareholder value." The
Company also announces that it has received a default notice from GE Capital Credit as a result of loan covenant violations under
its credit facility with GE Capital Credit. The Company is working with GE Capital Credit to address the financial problems and
correct the defaults. The Company previously announced efforts to sell its commercial dealer business. Any cash generated from
the sale of these business segments will be used to pay down the GE Capital debt and reduce the Company's ongoing working
capital requirements.
Verdant has pursued a strategy of growth through merger and acquisition since 1996, joining four businesses together and
increasing sales revenues from approximately $15 million to $75 million in 1999. While successful in building the revenue base, the
complexity of the businesses acquired, combined with decreased demand for some product lines because of industry changes and
unfavorable weather patterns, has led to ongoing losses and cash flow problems.
To address these difficulties, in May 2000 the Company engaged the services of The Platinum Group, a Minneapolis-based
turnaround management company. Platinum has worked closely with Verdant's management and Board to assess the Company's
businesses and define a strategy for addressing its financial problems and improving shareholder value. |
