June 5, 2009 5:30 AM
Dealmaker of the Week: Skadden's George Panagakis
Posted by Ross Todd
The Am Law Daily's mom always said, "never judge a book by its cover and never judge a deal before its done." Sorry mom. While we have the book thing down, this week we're giving our Dealmaker of the Week honors to a lawyer who's working on a deal in progress.
Skadden, Arps, Slate, Meagher & Flom restructuring partner George Panagakis is helping Chicago-based clothing manufacturer Hartmarx Corp. make its way through bankruptcy. Hartmarx has gained some notoriety for tailoring the union-made suits President Barack Obama wears. Since filing for Chapter 11 in January, Hartmarx has been looking for a buyer to avoid liquidation.
Two weeks ago, it looked like the company had found a willing partner. Hartmarx accepted a stalking horse bid worth $119 million from London private equity firm Emerisque Brands and SKNL North America to acquire essentially all of the suitmaker's assets. Then late last week, the group of banks providing credit to Hartmarx, led by Wells Fargo, announced their opposition to the bid because it failed "to provide adequate value to Hartmarx's lenders." Wells Fargo claimed the cash portion of the bid worked out to less than $56 million, or less than half the $114 million the lenders were owed. The lenders objection set up a pending showdown in bankruptcy court on Monday that the Chicago Tribune characterized as "The big bank versus the everyday worker."
Hartmarx and Panagakis went back to the negotiating table last weekend with the lenders and the private equity buyers. The result: An amended bid of $128.4 million by the Emerisque group was approved by the bankruptcy judge on Tuesday without objection from the lenders. While Hartmarx is still actively seeking other bids, the revised offer from the private equity firms promises to keep the business whole and operating. That's something we're sure the bank and the everyday worker will agree is a good thing.
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