Case Study

Integrated Electrical Services

CLIENT: Integrated Electrical Services ("IES")

Gordian Group acted as financial advisor to IES in connection with its restructuring, which resulted in a prearranged bankruptcy that lasted less than three months and resulted in management and existing equity holders retaining 18% of the pro forma equity despite the Company’s debt trading at highly discounted levels.


IES, a publicly traded company, is one of the leading national providers of electrical services in the United States. With approximately $1 billion in annual revenues at the time, IES provided a large range of services, focused primarily on competitive bid design and building, and the maintaining and servicing of electrical data communications and utilities systems for commercial, industrial and residential customers. Accounting misstatements, poor project management and reduced access to surety bonding, among other things, contributed to a significant deterioration in IES’s operating performance beginning in early 2004. As a result, the Company was faced with an overleveraged capital structure that it was unable to support. The Company’s bonds were trading at less than 60% of par and the Company had negative trailing twelve-month EBITDA.


Gordian Group was engaged to assist the Company in evaluating and implementing its restructuring alternatives and negotiating a favorable outcome with its creditors, in particular an ad hoc committee of the Company’s bondholders that Gordian successfully organized.


Through a prearranged bankruptcy that lasted less than three months, the Company implemented a plan of reorganization that provided 82% of the pro forma equity to the noteholders, 3% to management and 15% to existing equity holders; a tremendous outcome for old equity, given the discounted trading levels of the Notes when the deal was negotiated.