HORIZON PROPANE, LLC

SITUATION

  • Level Propane, a regional propane distributor, grew rapidly to $70 million in annual revenue (within the top 20 U.S. propane distributors) from start-up 10 years prior
  • The company served principally the residential market in 13 mid-west states and New Mexico
  • The company's cost-efficient strategy was based on a central operating model with all marketing, sales, customer service, delivery routing and dispatch, and all support functions located in Westlake, Ohio
  • Poor business decisions, lack of effective controls and imprudent pricing forced the company into Chapter 11 reorganization
  • An auction produced no qualified bidder for the company
  • Union Partners teamed with an investor group to provide DIP financing and interim management to bring the company out of bankruptcy

RESULTS

  • Union Partners successfully transformed the company during the remaining bankruptcy period and achieved positive EBITDA for the fiscal year
  • Union Partners with an investor group purchased the assets of the business bringing the company out of bankruptcy July 2, 2003
  • Union Partners and the investor group packaged and sold the company to a large strategic buyer on October 1, 2003
  • The transaction generated a 25%+ return on three-month equity investment

ACTION TAKEN

  • Union Partners assumed management of the company and implemented an aggressive transformation program
  • Cost and pricing models, operating budgets and key performance indicators were established and adhered to with discipline
  • Customer retention and re-capture programs and new customer acquisition programs were implemented concurrent with rolling out a new company name (Horizon Propane) and identity
  • Creative fuel sourcing strategies were developed and implemented to ensure supply during a record cold heating season
  • Staff was evaluated, trained and redeployed to capitalize on employee strengths and eliminate redundancy