Chapter 6 - THE DEBT HIDDEN INSIDE MERCER
Wyatt’s independent corporate counsel began reviewing the company.
Not Sabrina’s advisers.
Not Redfern’s.
Mercer’s existing records.
The answer appeared inside debt covenants.
Three years earlier, Sabrina arranged a refinancing package for Mercer through two lenders.
The loans helped renovate the Newark terminal and automate one warehouse.
Nothing suspicious.
Wyatt approved them.
But the package also included guarantees from a separate entity:
WM Property Services LLC.
Wyatt frowned when his lawyer mentioned it.
“What’s that?”
The lawyer looked surprised.
“You don’t know?”
No.
WM Property Services had been created eighteen months earlier.
Its manager:
Sabrina Mercer.
Its beneficial owners:
Still being determined.
Mercer Industrial had been paying WM nearly $70,000 a month for “property management, asset strategy, and leasing advisory services.”
Wyatt stared.
“That’s Sabrina’s consulting work?”
“Apparently.”
“She told me those payments were to outside specialists.”
The company had paid more than a million dollars into an entity controlled by Wyatt’s wife.
Some of the work might have been legitimate.
Sabrina did perform real financial and strategic services.
But the disclosure was nowhere near adequate.
Then the lawyers found something worse.
WM Property Services had borrowed against its future consulting payments.
Redfern Capital was one lender.
If Mercer stopped paying WM, Sabrina’s entity faced default.
If Blackridge purchased Mercer directly, many of the consulting contracts could be terminated at closing.
If Redfern acquired Mercer first, however, it could preserve those agreements and restructure them.
Abraham stared at the numbers.
“So the nineteen-million-dollar offer isn’t just cheaper.”
“No,” Wyatt said.
“It protects Sabrina’s side contracts.”
“And her debt.”
“Yes.”
The sale was not simply about grabbing the difference between nineteen and thirty-one million.
Sabrina had built a financial ecosystem attached to Mercer.
A direct sale to Blackridge would expose and possibly eliminate it.
A Redfern takeover would preserve it long enough for her investors to reorganize everything on their terms.
That explained her desperation.
But Wyatt still looked troubled.
“What?”
“She couldn’t build this alone.”
Abraham knew he was right.
Lenders.
Contracts.
Board consents.
Company payments.
Someone inside Mercer’s administration had to know.
Then Wyatt remembered something.
Six months earlier his longtime CFO, Mark Ellison, resigned unexpectedly.
Sabrina said he was retiring.
May you like
Wyatt never spoke with him directly.
Another story he had accepted because the person telling it sounded organized.
