FORT MILL, S.C. — Sunbelt Rentals has acquired Southern California aerial rental business Pacific High Reach & Equipment Services, based in Orange, Calif., acquiring substantially all its assets under Section 363 of the bankruptcy code for about $17.4 million.
Sunbelt Rentals was selected as the highest and best bidder after a comprehensive sale process. According to documents filed with the bankruptcy court, a number of companies expressed an interest in acquiring PHR. The transaction was approved by the bankruptcy court Nov. 15 and closed Nov. 18.
PHR has a rental fleet of about 1,200 pieces of equipment, primarily aerial work platforms. Founded in 2001, the company did well until 2008 when the economic downturn hit PHR hard, leading it to recently seek Chapter 11 bankruptcy protection. For Sunbelt, the purchase substantially expands its presence in the Southern California market, one of the country's most dynamic economies despite difficulties in recent years.
FocalPoint Securities served as the exclusive investment banker to Pacific High Reach. Ron Bender of Levene, Neale, Bender, Yoo & Brill served as bankruptcy counselor to Pacific High Reach. Matthew Pakkala of FTI Consulting served as the company's chief restructuring officer during the bankruptcy process.
“Sunbelt Rentals is an industry leader and this acquisition will help them expand their overall presence in the western region and capitalize on certain new niche market segments as well,” said Pakkala. “This competitive sale process helped generate a substantial recovery to creditors. FocalPoint's sound advice, commitment and expertise throughout the process was critical in achieving this result.”
Documents filed in bankruptcy court stated that although PHR's business has been profitable since filing, the company concluded that it could not generate sufficient profit to repay more than $24 million in secured debt plus interest, and no party has come forward to fund a plan of reorganization.
FocalPoint Partners LLC is a Los Angeles-based independent investment bank specializing in mergers and acquisitions, private placements — both debt and equity — financial restructurings and distressed transactions. It primarily serves middle-market clients throughout the United States.
Sunbelt Rentals, based in Fort Mill, S.C., is No. 3 on the RER 100. Its parent company is U.K.-based Ashtead Group plc.