Reid Tools Undergoes "Constructive Foreclosure"
August 22, 2011
Reid Tools, based in Coopersville, Mich., is undergoing a constructive
foreclosure, according to John Cammenga of White River Enterprises,
who currently is running the business as "an agent of the bank."
"A constructive foreclosure
means [the bank is] taking
the assets, the owner is surrendering the assets and the hope is
that the company can be re-emerged under a new entity under new
leadership," says Cammenga , who is overseeing the liquidation
of Reid's assets.
The bank placed the company in foreclosure on August 12, and Cammenga's
company, White River Enterprises, intends to form a new entity under
which Reid will continue.
"All of the employees of the employees, with the exception
of the former owner, Mr. [Jeff] Cothery, are continuing with the
new entity," says Cammenga.
He adds, "We expect the transition to be complete on September
Cammenga says customers should not see an impact during the foreclosure
"That's why I am here right now, before the transaction is
complete, to make sure all of the customers are taken care of,"
Asked what might have led to the company's downfall, Cammenga advises,
"I think there were problems with the economy in general. Other
than that, I guess I would have to defer to Jeff Cothery."
Cammenga , whose background is in both mergers and acquisitions
and defense contracts, remains optimistic about the future.
"I intend to run the company for the foreseeable future and
I am excited about the opportunities in the auto glass business
as well as knife-making and serving the cutlery trade," he
Cammenga says "most all" creditors will be paid through
the process, and that he believes Reid's former owners "agreed
to this constructive foreclosure in part to protect the creditors."
Attempts to reach Cothery for comment had been unsuccessful at
Need more info and analysis about the issues?
Subscribe to AGRR Magazine.