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West Liberty Foods Buys Bankrupt Quantum Foods' Assets

25 June 2014

US - The equipment and inventory formerly owned by bankrupt Quantum Foods in three Bolingbrook plants have been sold as a turnkey operation to West Liberty Foods in a $12.7 million deal.

The deal was coordinated by Tiger Group, City Capital Advisors, LLC, and Schneider Industries.

The acquisition of the equipment and inventory was approved on 19 June by US Bankruptcy Judge Kevin J. Carey, sitting in the District of Delaware.

In separate transactions unrelated to the bankruptcy but also directed by Tiger and Schneider, West Liberty has agreed to purchase or lease the three Bolingbrook buildings that housed Quantum's operations.

The company plans to purchase the 220,000-square-foot production facility and 80,000-square-foot culinary facility, and agreed to lease the 250,000-square-foot cold-storage distribution centre.

As a result of the transactions, Tiger and Schneider cancelled a live webcast auction for the former Quantum assets that had been scheduled for 24, 25 and 26 June.

"The successful conclusion of this turnkey sale means that hundreds of jobs will be created," said Tiger Director Andy Babcock.

"West Liberty plans to immediately begin the process of restarting the operations at the facilities."

"West Liberty Foods' continued growth has put us in a position to make this acquisition," said Ed Garrett, President and CEO of the West Liberty, Iowa-based company. "The Quantum facilities are well positioned to support our existing growth plans and will allow us to continue to offer the high quality, innovative, and food safe products we are known for."

The company, which plans to have 400 to 600 employees at the Bolingbrook sites within the next 12-14 months, will re-brand the facilities under the West Liberty Foods name.

"We were very pleased to see the deal completed as a single turnkey operation," said Michael Pizette, Chief Credit Officer of secured lender Crystal Financial LLC.

"In addition to saving valuable time, the approach in this case significantly increased recovery for the creditors compared to a piecemeal auction. The result underscores how Tiger represents the new generation of asset disposition professionals. The Tiger team doesn't just show up looking for value, instead they create it."

Former operator Quantum Foods was launched more than two decades ago, as a hand-cut beef butcher. The company ultimately grew to an approximately 1,100-employee operation, supplying commercial accounts as well as overseas military bases.

However, the recent withdrawal of troops in the Middle East, along with the loss of top retail clients, hurt its business operations, leading the company to file for Chapter 11 bankruptcy on 18 February in the Delaware Bankruptcy Court.

"Although this was a complex transaction, Tiger's experienced liquidation division, transaction advisory services and disposition services teams were able to work seamlessly together to find the buyer and close the deal within about one month from the engagement date," said Mr Babcock.

"I'm very pleased that our teams were able, as usual, to leverage their expertise to close this deal so quickly and to help get so many people back to work."

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