Chris Carey Advisors has won the “Chapter 11 Reorganization of the Year” award for its role in creatively restructuring and rescuing Elizabeth-based EZ Worldwide Express from bankruptcy. The advisory firm was instrumental in steering the privately-owned delivery services company from combined unprofitable revenues of $55 million in January 2016 to more than $45 million in profitable income within the year. Today EZ Worldwide Express provides seamless, gainful services for retail giants such as Amazon, the Disney Store, Forever 21, H&M and Phillips Van Heusen.
The honor was presented recently to Chris Carey ― founder and CEO of the financial and business process advisory firm, with clients across New Jersey ― by M&A Advisor, as part of its 11th Annual M&A Advisor Turnaround Awards program. This initiative recognizes the creativity and perseverance of the restructuring and distressed investing industry’s top professionals, and serves as the segment’s benchmark for excellence.
Carey was distinguished in the $25 million to $100 million mid-market category as a driving force in EZ Worldwide Express’ quick and stellar turnaround.
This same Chapter 11 reorganization plan also was selected by Global M&A Network as “Turnaround of the Year” ― the best value-creating restructuring transaction overall for CY2016 ― in the $50 million to less than $100 million category. More than 300 transactions were evaluated for several prestigious award categories as part of Global M&A Network’s annual Turnaround Atlas Awards.
Carey’s “expertise in business restructuring as well as his vision and confidence brought discipline to this life-threatening business situation” stated Warren J. Martin, attorney and turnaround team leader for EZ Worldwide Express. “Chris created a lucid, executable business plan that saved the company.”
Martin ― principal of Porzio, Bromberg & Newman of Morristown and co-chair of its Bankruptcy and Financial Restructuring Department ― added that Carey “implemented benchmark assessment tools and restructured EZ’s chain of command to create a culture of assessment that he used to significantly reduce costs. He’s a process engineer that rolled up his sleeves and made real changes that impacted EZ’s bottom line.”
Edward P. Bond, CPA, CFE, CIRA and partner in the Insolvency and Litigation Division of Bederson LLP of West Orange, also served as a key member of the turnaround team. Explained Bond, “Our company was retained by an EZ debtor involved in the Chapter 11 reorganization, during which I served as chief reorganization officer. My financial team sought a partner with expertise in logistics as well as mergers and acquisitions. Chris, who was recommended to us by several clients, demonstrated vast knowledge in both areas and delivered exactly what we needed. His greatest contribution was analyzing and economizing the company, recognizing the changes needed, and streamlining the business to bring about profitability,” said Bond. “Chris also was instrumental, actually invaluable, in obtaining the financing necessary to have the business continue. He was a great stabilizing factor in this turnaround.”
Ultimate Plan Sketched on an Envelope
Martin recalls that during a key in-court moment in the bankruptcy case, he received a text reporting that EZ Worldwide Express’ largest customer, “historically representing about 45% of revenues,” had moved to another delivery company. Subsequently holed up in a conference room, the turnaround team took the news badly and sensed their legal case would be lost.
“Then Chris brightened and said, ‘Wait! I know how this business can work without its largest customer!’ then sketched a cohesive reorganization plan on the back of an envelope,” revealed Martin. “That plan ultimately drove EZ’s turnaround. Before too long that large, principal customer came back, along with many new accounts.”
EZ Worldwide Express grew rapidly from a single storefront to 700 employees, 300 trucks and 13 locations across the nation. As can happen when young companies expand, growth and costs got out of control: With its commitment to great customer service, for example, EZ provided whatever a customer wanted, whenever, without checking costs, and thus started losing money.
Early in 2016 EZ Worldwide Express, along with its affiliate, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of New Jersey. During those proceedings, the company closed on Debtors-in-Possession financing packages with three different lenders. Working closely with the crisis reorganization team comprised of Martin, Bond, Carey and others, EZ Worldwide Express emerged less than one year later as a solid, streamlined business with approximately 350 employees, 150 trucks, six locations, and $45 million in profitable revenues.
“The challenge for our team, which Chris helped us surmount, was reducing costs while still maintaining EZ’s high customer service levels,” said Martin. “Though we cut costs considerably during the reorganization, EZ sustained its great reputation for customer service and continues to obtain new clients.”