Avadim Health

Summary

Chief Restructuring Officer

Asheville, NC

Avadim Health (“AHI”) is a vertically integrated healthcare and wellness company selling topical products that improve neuromuscular health and skin barrier health. It’s product portfolio includes six products sold across AHI’s retail and clinical customer channels.

Key Challenges

Product Manufacturing

Supply Chain Disruptions

Liquidity & Working Capital Shortage

Leveraged Capital Structure

Media & Marketing Strategy

Situation Overview

CMA was retained by AHI’s Board of Directors as financial advisor to provide an assessment of the Company and to review strategic alternatives available to AHI. CMA was subsequently retained as CRO to guide AHI through a Chapter 11 restructuring and §363 sale to the pre-petition lenders.

Engagement Highlights

Initial Assessment and Review of Strategic Alternatives

Reviewed in detail various key aspects of AHI’s business, including its cost structure, significant spending items, customer concentration & profitability, inventory production, and working capital efficiency, among others.
Assessed working capital and liquidity needs on a rolling 13-week basis.
Completed a thorough review of AHI’s historical and projected financial performance and helped communicate the go-forward plan to the Board of Directors and lenders.

Restructuring Process

As CRO, AHI filed for Chapter 11 on May 31, 2021, with more than $100 million of debt.
Obtained $7.2 million DIP facility and prepared DIP budget.
Facilitated a §363 sale as AHI’s Chapter 11 exit strategy whereby the lenders agreed to enter the Chapter 11 proceedings as a stalking horse credit bidder with an agreement to retain all AHI employees post-reorganization.
- Potential 3rd party buyers were approached throughout the sale process to seek qualified bids above the stalking horse bid to maximize AHI’s enterprise value.