Industry: Building Materials & Services / Labor Services
Transaction: Majority Sale to Financial Buyer


Colorado Catastrophe & Restoration, Inc. ("COCAT") is a disaster restoration services company that specializes in restoring, remodeling and renovating commercial and residential property from damage sustained by fire, flood, mold, storm and other natural or man-made disasters.

In 2006, GMB Business Advisors was engaged by COCAT as its exclusive investment advisor to assist the company in a leveraged recapitalization with Progress Equity Partners. GMB Business Advisors was retained by COCAT in response to a preemptive offer made by Progress Equity. Since COCAT's majority shareholder was an absentee owner, the company's CEO was motivated to engage in a transaction to restructure the ownership structure of the company.

GMB Business Advisors worked diligently on COCAT's behalf to negotiate an Asset Purchase Agreement and Employment Agreement with Progress, critical elements to closing the transaction. GMB Business Advisors also developed an extensive financial model to educate the client on the impact the proposed capital structure would have on COCAT as well as how the distributions would be paid to the owners. GMB Business Advisors was instrumental in ensuring an efficiently run process. However, GMB Business Advisors was prepared to take COCAT through a broad auction process should Progress Equity's offer fail to close.

The successful transaction allowed COCAT to restructure its ownership structure to reward the active CEO for the performance of the company. With the assistance of a financial partner, COCAT was able to expand into new markets, growing the business and taking it to the next level.

The transaction was supported by senior debt from Colorado State Bank and Trust and mezzanine financing from Nashville-based Harbert Management Corporation and Stonehenge Capital Company, a Colorado-based CAPCO organization.

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