Jay Goffman, the former global head of restructuring at Skadden Arps, and Steve Smith, the former global head of restructuring and leverage finance at UBS, launched a boutique restructuring advisory firm named Smith Goffman Partners. The firm will feature a merchant banking model that provides advice and capital to its clients.
During their careers, Smith and Goffman have restructured more than $1 trillion in debt, with deals including an engagement with LyondellBassel, where Goffman represented the owner and Smith led the team at UBS, which provided a $6.5 billion debtor-in-possession loan, the largest in a U.S. bankruptcy history.
“We can’t think of a better time to launch given the increase in the number of bankruptcies we have seen and are seeing this year and the recessionary headwinds in the economy,” Smith said. “And I can’t think of a better partner than Jay Goffman to co-found this firm with. Our intent going into this is to remain a boutique so we can be intimately involved in advising and guiding our clients. We want our clients to know that we will be hands-on so that they can get the benefit of our many years of experience.”
During the $20 billion prearranged Charter Communications reorganization, Smith represented the largest group of creditors and post-reorg equity holders, while Goffman represented Charter’s owner, Paul Allen.
Smith also served as financial advisor to General Growth Properties, which was at one point the second-largest mall operator in the U.S., during its bankruptcy proceedings. Under Smith’s stewardship, the team presented the board with an equity fundraising that served to put a floor under competitive bidding by several buyers to control the company post-bankruptcy.
“We believe our firm fills an important niche,” Goffman said. “Our clients will be advised by two very senior and experienced professionals who have not only been personally involved in nearly every industry and every aspect of a restructuring, but who have headed the restructuring practices for one of the largest law firms and one of the largest investment banking firms in the world.”
Goffman was a partner and head of the corporate restructuring practice at O’Sullivan Graev & Karabell before starting his 24-year career at Skadden.
While at O’Sullivan, he was credited with pioneering the prepackaged reorganization, a strategy that allows companies to emerge from bankruptcy in days rather than years by negotiating with creditors in advance of Chapter 11 proceedings.
Goffman was most recently client chairman of Teneo’s financial advisory business and Smith was managing partner of Aurora Resurgence, a Los Angeles-based distressed for control fund.
