VER Chief Executive Officer Digby Davies announced today that VER will merge with Production Resource Group.
One of the world’s largest production equipment rental operations, VER boasts offices on six continents, including a 95,000 square-foot facility in McCook, IL, a suburb bordering the west side of Chicago.
Production Resource Group, founded in 1995, is “the global partner of choice for the world’s leading entertainment and event producers, designers, and creative talents,” according to its website. The site lists eighteen U.S. offices, including one in Buffalo Grove.
In order to facilitate the deal, VER has filed a Chapter 11 petition and agreed to a court-supervised restructuring process expected to last four to six months. The action was prompted by the company’s inability to service its current debt load.
VER’s recent performance includes a record number of new clients and customer satisfaction ratings that are highest in the industry.
In order to counteract the liabilities and ensure continued growth, VER has reduced outstanding debt and raised financing to provide up to $64.7 million in new liquidity.
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According to sources close to VER Chicago, the general mood at the facility is marked by relief as well as enthusiasm.
Executive Director of TV Film and Broadcast, Casey Starr, told Reel Chicago, “This is an exciting time for VER. We have new financing in place to invest in the business and our clients will benefit. It’s business as usual during this time and our projects globally, including the Dick Wolf productions in Chicago that we’re so proud of, will not be impacted.”
In a letter sent to select contacts, Davies stated that the maneuver “will be seamless for our clients and will result in no disruption to our operations.”
Here is the full text of the letter:
I would like to update you on an important step that VER has taken in order to position the Company for future success.
VER announced today that it has entered into an agreement to merge with Production Resource Group LLC, (“PRG”) and also filed voluntary petitions for reorganization under Chapter 11 to implement the agreement.
We believe that undertaking the court-supervised restructuring process is the best course of action for VER. Despite a record number of new clients and customer satisfaction ratings that are highest in the industry, VER has struggled due to an inability to service its current debt load. In entering this reorganization, we have reached an agreement with our existing stakeholders to significantly reduce outstanding debt, and have raised financing to provide up to $64.7 million in new liquidity to allow us to operate successfully as we undergo this exciting transition.
The Chapter 11 process will provide greater stability and the opportunity to increase investment in the business. In merging with PRG, the combined entities will be able to meet evolving client needs and offer solutions, resources and expertise in ways neither company could achieve independently.
Importantly, VER’s operations will continue in the normal course during this process — all existing productions or new projects that are signed on during the process will not be interrupted.
A few key things you need to know:
We expect that this process will be seamless for our clients and will result in no disruption to our operations. VER has always been known for reliability and our clients can continue to rely upon us. Additionally, we will maintain our commitment to provide extraordinary service and competitive pricing.
We intend to move through this financial restructuring process as expeditiously as possible. We anticipate that the restructuring process will take approximately 4-6 months and we expect to emerge from Chapter 11 with a new capital structure, sufficient cash to fund operations and the ability to access capital to fund new growth initiatives.
A merger of VER and PRG will give you even more opportunities to be successful. The combined businesses will have by far the most experienced team, and the broadest range of production equipment and services in the world.
Until the restructuring process is complete, VER and PRG will continue to operate as two separate companies and it will be business as usual.
We will keep you informed as we move forward. If you have any questions, please reach out to your VER contact. You can also visit VER.com/restructure for more information.
We value our relationship with you and are confident that by working together, we will emerge from this process an even stronger company. Thank you for your continued support.
Chief Executive Officer
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