● Purchase of distressed debt position
● Provision of operational management
● Provision of working capital within an
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Situation
Having incurred significant trading losses for a number of years, the department store group Allders was facing Administration. Lenders to the business believed their position was at risk and felt that they were unlikely to recover a significant portion of their loans to the company. The Lenders decided to sell over £150m of debt to a consortium led by Hilco.
Action
Given the precarious position of the business, the directors decided to appoint Administrators. Hilco’s retail support specialists were appointed to assist the Administrators in the day-to-day operation of the company’s stores. Hilco provided £15 million of additional working capital in order to extend the life span of the Administration and thereby secure a more orderly disposal of the business and assets than would otherwise have been possible.
Result
With Hilco’s assistance and funding, the Administrators were able to extend the period of trading so that 30 Allders stores could be sold to other retailers, including
Debenhams, Bhs and Primark, whilst retaining over 3,500 jobs within the business.
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