Harvest Sherwood
Harvest Sherwood, a national food distributor serving more than 2,000 customers—including major grocery chains, cruise lines, and hotel groups— encountered financial and operational challenges in 2024, and continually struggled with operational challenges and less than optimal margins, resulting in poor cash flow, and prompting its lenders to become increasingly concerned. As a result, a sale process was initiated. The sales process was then hampered by the loss of a key customer responsible for 25% of the Company’s revenue resulting in the need to find a different solution to the challenges the company faced.
Concerned about their collateral, the Company’s bank group and advisors reached out to Hilco for a solution. Hilco Global swiftly mobilized a cross-functional team to design and implement a comprehensive wind-down and monetization strategy. By seamlessly integrating its deep expertise in inventory, machinery and equipment, accounts receivable, FF&E, and rolling stock, Hilco delivered a cohesive end-to-end solution. Leveraging the strength of its broad platform, Hilco led the monetization of inventory and fixed assets while simultaneously driving the recovery of both current and aged receivables—all executed under the unified Hilco Global umbrella. Hilco has successfully deployed this model multiple times over the past few years.
The Hilco team was selected by the senior lender group to lead the effort due to Hilco’s advisory capability, its unique experience in managing complex monetization wind-downs both inside and outside of court-driven restructuring, and its ability to be on the ground in just a few days.
Within days Hilco assembled a team of resources and coordinated across Harvest Sherwood’s functional teams to monetize the Company’s inventory and fixed assets, manage logistical complexity, collect receivables, and interface with legal stakeholders.
Upon arrival Hilco worked with operations to categorize inventory by freshness and expiration, setting pricing strategies to maximize recovery. This required prioritizing high-risk goods for sale to avoid spoilage, while addressing safety and compliance issues. Hilco took over day-to-day oversight immediately for asset related operations and provided advisory services for the company, its legal team, bank counsel, and the unsecured creditor committee in a relatively short period of time to maximize recoveries.
Hilco also helped stabilize the workforce and reduce cost exposure at the facility level. By identifying buyers for certain sites and implementing employee retention strategies, Hilco maintained critical personnel during early phases of the wind-down, using only 20% of the designated retention budget. Hilco Global further applied its expertise in FF&E to identify, market, and sell stranded onsite assets – maximizing recovery and ensuring that no residual value was overlooked.
Within 70 days the majority of inventory sales were complete as receivables collections continued. Inventory recovery exceeded 90% of book value, and ongoing receivables recovery will exceed 84% upon completion. Debt to lenders was significantly reduced, with the remaining balance expected to be offset in the future as final winddown activities continue. A Chapter 11 filing was anticipated to finalize creditor settlements, with nearly all operations ceased and most assets already monetized. The filing was intended to formally conclude the process rather than unlock recovery.
This engagement illustrates Hilco Global’s ability to execute complex wind-downs outside of bankruptcy. With expertise across operational, financial, and legal disciplines within one organization, Hilco delivered a comprehensive solution that protected lender interests, minimized risk, and preserved value in a time-sensitive environment.
