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Monday, January 19, 2009

Even the Turnaround Guys are in a Recession

We are in the business of turning around companies, and yet we are not seeing many solid turnaround opportunities. Rather surprising given the state of the economy and a trend that has been puzzling us for quite some time as we figured we would be overwhelmed with turnaround work. Turns out, we are not the only one's noticing the lack of turnarounds. Yesterday's Washington Post has an article about the disturbing trend of many businesses, both big and small to just shut off the lights. Just look at the plight of Franklin Equipment, which was mentioned in the story:

The owners of Franklin Equipment Co., a manufacturer of logging tractors in the western Tidewater area of Virginia, said earlier this month that they would file for Chapter 7 and sell off their assets after 46 years in business, putting about 70 employees out of work. Clyde Parker, Franklin's personnel director, said the company was done in by a drop in demand for lumber and paper products, financing issues and a dearth of interested buyers."We've been through a lot of downturns over the years . . . but none near as severe as the one we're in now," Parker said.

We are agree with you Clyde. If this keeps up, an increase in turnaround situations might actually indicate that the economy is improving!

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