Essex Crane revolver agent gives notice of planned collateral auction

By Wendy Van Sickle

Columbus, Ohio, July 11 – Essex Rental Corp. wholly owned subsidiary Essex Crane Rental Corp. received a notice on July 1 from the agent of its revolving credit facility that the agent intends to offer for sale in a public auction all of the rights, title and interests of Essex Crane, according to company press release issued Monday.

Essex Crane had entered into a sixth forbearance agreement with the administrative agent and lender, Wells Fargo Capital Finance LLC, and other lenders PNC Bank, NA, Alostar Bank of Commerce, Kayne Senior Credit Fund (QP) LP, Kayne Senior Credit Fund LP, 1492 Capital LLC, and Medley Capital Corp. on June 23.

Under the forbearance agreement, through its July 15 term, Essex Crane will fund operating expenses using cash collections and no new revolving loans will be requested by or advanced.

Additionally, Essex Crane agreed to cooperate with the lenders with respect to the lenders’ plan to conduct and consummate a transfer under Article 9 of the Illinois Uniform Commercial Code with regard to some or all of the collateral.

Essex Crane’s personal property to be auctioned may include all its accounts, inventory, machinery, equipment, investment property and general intangibles.

The agent and lenders have reserved their right to withdraw or add all or any portion of the collateral from or to the sale and may cancel the sale at any time for any reason, according to the release.

“Over the past year, Essex Crane has been operating under forbearance agreements and working with its lenders to identify the way to best maximize value for all of its stakeholders,” Nick Matthews, president and chief executive officer of Essex, said in the release.

“Throughout this process, we have explored several options including the sale of Essex Crane as a going concern, selling equipment assets in auctions and by other means and restructuring around a smaller level of debt. At this point, Essex Crane’s lenders have chosen to offer Essex Crane’s assets in a public auction in an effort to increase the value received in exchange for those assets.

“It is unclear if the public auction will provide more value than the other strategies already pursued or what other alternatives the lenders may choose to pursue if the auction does not result in the sale of all or a portion of Essex Crane’s assets.”

Essex is a provider of rental and distribution for mobile cranes based in Buffalo Grove, Ill.

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