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LVI RESTRUCTURING CONSUMMATED

 NEW YORK, May 6 /PRNewswire/ -- The LVI Group Inc. (NYSE: LVI) and LVI Corporation jointly announced today that they had consummated their previously announced debt restructuring. As a result of the restructuring 100 percent of the Class A, and over 97 percent of the Class B, senior secured redeemable notes of NICO, Inc., the principal wholly owned subsidiary of The LVI Group, have been retired, 3 million shares of common stock (27 percent of outstanding) of the LVI Group have been returned to The LVI Group and LVI Holding has acquired from The LVI Group all of the stock of LVI Environmental Services Group Inc., a subsidiary of The LVI Group that conducts asbestos abatement operations. The LVI Group's consolidated indebtedness has therefore been reduced from approximately $45.6 million to approximately $4.3 million. LVI Holding has also acquired a 2-1/2 year warrant to purchase 49 percent of the common stock of Hallmark Electrical Supplies Corp., a subsidiary of The LVI Group over the next six months in installments to fund operating expenses and working capital requirements. The terms of the transaction were negotiated by representatives of The LVI Group, LVI Holding and two former holders of the NICO Class A and Class B notes -- AIF II, L.P. and T. Rowe Price Recovery Fund.
 LVI Holding, which is not affiliated with The LVI Group, is a newly formed company organized by management of LVI Environmental to acquire LVI Environmental. Burton T. Fried, the former president of the LVI Group, has become the CEO and chairman of the board of LVI Holding. AIF II, together with an affiliated entity on behalf of a managed investment account ("Apollo"), owns approximately 67 percent of the non-voting preferred stock and non-voting common stock of LVI Holding, and T. Rowe Price Recovery Fund owns approximately 30 percent of each class. Management will initially own all of the voting common stock of LVI Holding, which represents 10 percent of the outstanding common stock, and will participate in a management equity plan which will entitle them to a substantial amount of additional common stock under certain circumstances.
 Commenting on the restructuring, Salvatore J. Zizza, the chairman of the board of the LVI Group, said, "We are very pleased that this restructuring has been completed. We believe that our shareholders will benefit from the substantial debt reduction and the return of 27 percent of the outstanding common stock previously held by Noteholders. At the same time, we are happy that the former NICO Noteholders were given the opportunity to obtain value for their Notes and wish the new owners of LVI Environmental well in their future endeavors."
 Said Mr. Fried, "We are very enthusiastic about LVI Environmental's prospects. Now that the company has a virtually debt-free balance sheet and management has a significant equity stake in the company's results, we are looking forward to building on our reputation as the premier asbestos abatement company in the country. We are grateful to our employees and clients who remained loyal to us. We believe that we can use our new-found financial strength, our experience and our reputation to increase our market share in the $3 billion asbestos abatement industry and to expand into other related environmental fields."
 A representative of Apollo, Steven F. Mayer, said "Mr. Fried and his management team have already demonstrated their ability to operate profitably in a difficult economic environment. LVI Environmental has an outstanding reputation in the asbestos abatement field and we view this investment as an excellent opportunity to become partners with a talented management team in the burgeoning environmental arena. We believe that the company is now well-positioned to increase its revenues and cash flow and are confident that this investment will be a very profitable one for us."
 LVI Environmental, through its subsidiaries, is a national asbestos abatement contractor providing asbestos removal and related services throughout the country and outside the continental United States. During 1992, LVI Environmental accounted for approximately 75 percent of the operating revenues of the LVI Group, Inc.
 Apollo and a related fund are private investment funds with investment capital in excess of $1 billion. Apollo's diverse holdings include, among others, majority stockholder positions in Gillett Holdings, Inc., which is the holding company for the Vail, Colorado ski resort, Interco Incorporated, which is the holding company for the manufacturer of Florsheim and Converse shoes and Lane and Broyhill furniture, the Alexandra Publishing Company, the owner and publisher of the New York and National Law Journals, Lamonts Apparel, Inc. a department-store chain in the Northwest, and Empire Poultry, the largest producer of kosher poultry in the United States. Apollo's holdings also include a 50 percent interest in Hanna-Barbera Entertainment Co. through a joint venture with Turner Broadcasting Systems, Inc., a significant equity interest in Whitmire Distribution Company, a $2 billion pharmaceutical distribution business, and a 50 percent interest in Buster Brown Apparel.
 T. Rowe Price Recovery Fund, L.P. is a limited partnership formed by T. Rowe Price Associates, Inc. for the purpose of investing in the securities of companies undergoing financial restructuring. The Recovery Fund and other portfolios managed by T. Rowe Price, have made significant investments in Seaman Furniture Company, Inc., CalFed, Inc., Maxicare Health Plans, Inc., Integrated Resources, Inc., and Liquor Barn, Inc. among others.
 -0- 5/6/93
 /CONTACT: Salvatore J. Zizza, chairman of the board of The LVI Group Inc., 212-951-3675; or Burton T. Fried, chairman of the board of LVI Holding Corporation, 212-951-3660/
 (LVI)


CO: The LVI Group Inc. ST: New York IN: SU: RCN

SB-SO -- NY059 -- 5442 05/06/93 12:21 EDT
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Publication:PR Newswire
Date:May 6, 1993
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