Silverleaf Resorts Back at Lender's Table; Belt-Tightening Immediate Stopgap Measure

DALLAS-Silverleaf Resorts Inc., based in Dallas, is back at the table with a lender to extend its credit line while a major belt-tightening is under way to keep the resort owner afloat.

“The bottom line is we’ve got a liquidity issue,” Thomas C. Franks, Silverleaf’s executive vice president, tells GlobeSt.com. “It is serious but not insurmountable.” UBS Warburg has been brought on board as the exclusive financial adviser to steer the 12-year-old Silverleaf out of its fiscal dilemma.

Just a week ago, stock trading had quickly halted after Silverleaf announced that talks had fallen apart with its major lender for a credit line extension. With new talks under way, Franks says the belt-tightening process has begun and there’s optimism in the ranks. General administrative expenses are gone, calls centers will be consolidated and no more expansions will be undertaken at its 22 time-share resorts until there is a turnaround. At this time, he says there are no plans to sell any resorts in the six-state portfolio, which services 116,000 members. “We are tightening up everywhere,” he emphasizes.