SSG Capital Advisors, LLC acted as the investment banker to Centerstone Linen Services, LLC d/b/a Clarus Linen Systems in the sale of its assets and multiple operations to Crown Health Care Laundry Services, PureStar Linen Group, LLC ("PureStar"), and Clean Textile Systems, LP d/b/a CleanCare ("CleanCare"). The sales were effectuated through a Chapter 11 Section 363 process in the U.S. Bankruptcy Court for the Northern District of New York.
Headquartered in Buffalo, New York, Clarus is a leading provider of high-quality linen rental and commercial laundry services to the healthcare industry. Together with its subsidiaries, Clarus operated five production facilities in the states of New York, Georgia and South Carolina that provided daily pick-ups and deliveries to their customers.
Facing management turnover, declining revenue and operational challenges, Clarus implemented various strategic initiatives in 2017 and 2018, including contract rationalization and the closure of two plants. Additionally, cash constraints negatively impacted their ability to consistently purchase adequate linen, leading to plant inefficiencies and fulfillment issues. Ultimately, Clarus filed for Chapter 11 protection and retained SSG.
SSG conducted a comprehensive marketing process which resulted in a wide range of interest, primarily from strategic parties that focused on the individual production facilities. The process resulted in multiple offers for the operations and assets. SSG's deep industry expertise and experience running a thorough sale process created a competitive auction environment. Ultimately, offers from three separate buyers were selected as winning bids to maximize value for stakeholders. Crown purchased the Spartanburg, South Carolina and Albany, Georgia operations, CleanCare acquired the Buffalo, New York, operation and PureStar purchased assets in Atlanta, Georgia.
Crown, a portfolio company of Quilvest Private Equity, is an independent full-service health care laundry processor and linen rental company. PureStar is a provider of laundry services and linen management to the hospitality industry. CleanCare is a leading textile and linen rental service for the health care and hospitality industries.
Other professionals who worked on the transaction include:
* Ronald Teplitsky of Next Point LLC, Chief Restructuring Officer of Clarus Linen Systems;
* Stephen A. Donato, Camille W. Hill and Andrew S. Rivera of Bond, Schoeneck & King, PLLC, counsel to Clarus Linen Systems;
* Angela Z. Miller and Catherine N. Eisenhut of Phillips Lytle LLP, counsel to the senior lender;
* Mark Samson and Bert Weil of Getzler Henrich & Associates LLC, financial advisor to the senior lender; and
* David M. Banker and Gilbert R. Saydah, Jr. of Montgomery McCracken Walker & Rhodes LLP, counsel for the Unsecured Creditors Committee.