Client Profile

Zestra Laboratories, Inc. ("Zestra" or the "Company") is a recognized consumer product leader in the female sexual health market selling in nearly 40,000 retail outlets in the United States and Canada. Zestra’s flagship product, Zestra® feminine arousal fluid, is a natural, non-hormonal, topically-applied formula that addresses the most common sexual problems reported by women, including those with Female Sexual Dysfunction (FSD). The Company distributes Zestra® through a retailer network of major chain pharmacies such as CVS, Walgreens, Brooks/Eckerd, Rite Aid, Duane Reade, Wal-Mart, Target, Kmart, and certain major supermarket chains. The Company also operates an internet retail channel with in-house fulfillment for consumers in the United States; and sells to a distributor in the United Kingdom, Asia, and Holland. Zestra is headquartered in Charleston, South Carolina.

Situation

Zestra filed for protection under Chapter 11 of the United States Bankruptcy Code on June 29, 2008 after pursuing several options to increase efficiency and revise its capital structure. In conjunction with the Company’s filing, Semprae Laboratories, Inc. (“Semprae”), a joint venture of The Jannick Group, LLC and Quaker BioVentures placed a bid to become Zestra’s stalking horse bidder.

Solution

SSG was retained by Zestra to conduct a sale of the business pursuant to Section 363 of the United States Bankruptcy Code. After managing a rigorous sale process, SSG and Zestra concluded that the offer made by Semprae was indeed the highest and best offer. The sale transaction closed in August 2008.

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