The Situation

In 1992 the Baldinger family sold a 50% interest to a large strategic partner operating numerous bakeries. The partner was now in the process of selling all of its bakeries and wanted to include Baldinger Bakery in the sale.

The family did not wish to sell but lacked the capital to buy out the partner. Substantial intercompany debt combined with recent losses resulting from the transition to a new, state-of-the-art bakery complicated the financing challenges. An additional factor was the inflexible structure of the New Markets Tax Credit financing that had been used to fund the new facility.

While not profitable the prior year, the company had turned the corner and was projecting strong performance.

The Transaction

Teneca’s mandate was to arrange a recapitalization of the company to extinguish all obligations owed the exiting partner while preserving the NMTC structure. Tapping our national network of financing sources resulted in a number of funding options that coalesced in an attractive recapitalization totaling approximately $35 million.

The Result

The financing we arranged allowed our client to avoid an unwanted drag-along sale, repay the existing strategic partner without disturbing the NMTC structure and enable the Baldinger family to continue operating its legacy business.

Baldinger is the recipient of the 2014 Association for Corporate Growth Middle Market Corporate BOLD award.