General Crane USA has gotten the lift it needed to pull out of the economic downturn and rise out of bankruptcy.
Prophet Equity, a Southlake, Texas-based firm, and General Crane co-owner and President Jim Robertson created Allegiance Crane & Equipment, which, in turn, purchased the assets of the Pompano Beach-based company for $40 million.
The deal was finalized after a bankruptcy court judge in Fort Lauderdale approved the liquidation plan on Dec. 17.
“In one fell swoop, the assets that were General Crane became the assets of Allegiance and the old set of encumbrances were dealt with,” Prophet Equity CEO Ross Gatlin said.
As the Business Journal first reported in November, General Crane fell on hard times in 2009, filing for Chapter 11 following the collapse of the real estate market. At that time, there were more than 10 lenders owed more than $100 million.
Robertson said he had been looking for someone to partner with, and Gatlin’s vision was aligned with his.
“They are not looking for a five-year get-out,” Robertson said. “I was not interested in that. I was interested in a long-term relationship.”
The deal received the blessing of the three major secured creditors – Wells Fargo, SL Financial and Bank Midwest – which had $62.4 million in secured claims.
“It was a $40 million purchase, and the three major lenders were paid a substantial amount, and we agreed to terms and conditions of a restructured loan,” Robertson said. “They didn’t come out completely whole, but they came out better than if we filed for liquidation.”
Gatlin said the company is looking for opportunities in growth areas such as construction of schools, highways, ports, power plants and petrol refineries.
“There’s a lot of good work out there, you just have to be active and target it,” he said.
In addition, the company will be expanding its operations into growth markets in Alabama, Louisiana, Mississippi, Texas and Oklahoma.
In about six weeks, the company will move to its new headquarters at 777 S. Andrews Ave., in Pompano Beach, allowing it to consolidate its headquarters and maintenance facilities.
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