A complicated corporate transaction involving members of Alston & Bird’s Global Finance & Debt Products and Employee Benefits & Executive Compensation Groups has been selected as a finalist in two categories for a 10th Annual M&A Advisor Award. The transaction was also nominated for an M&A Advisor Turnaround Award. An Alston & Bird team worked on the $85 million sale of Tobacco Rag Processors, Inc. to the Tobacco Rag Processors, Inc. Employee Stock Ownership Trust and the placement of $75 million in senior secured facilities.
Alston & Bird represented SunTrust, which served as the administrative agent with respect to the deal. In this capacity, Alston & Bird was responsible for negotiating and drafting the relevant financing documents. The transactions required Alston & Bird’s expertise under applicable federal tax law (including ERISA) and applicable laws of secured transactions in order to obtain a security interest in Tobacco Rag’s assets.
While the use of an ESOP to purchase a corporation is not a new transaction, this deal was particularly complex because it was financed through a combination of bank and seller financing by Tobacco Rag’s principal shareholders. Alston & Bird, working in tandem with the firms representing the other entities in the deal, was able to protect the interests of its client while allowing the sellers, Tobacco Rag and its employees to recognize their desired tax, succession and business objectives.
The M&A Advisor Annual Awards will be presented at the 2011 M&A Advisor Summit and Awards Gala on December 13 in New York. The 2012 Turnaround Awards will be distributed at the upcoming 2012 Distressed Investing Summit and 6th Annual Turnaround Awards Gala on January 31, 2012, in Palm Beach, Florida.