Resolving distressed retail situations
GA Europe is a 100% owned subsidiary of US-listed Great American Group. New to the European market in 2010, the company is fast developing a compelling track record, operating in partnership with retailers, private equity sponsors, financial stakeholders, corporate lenders and their professional advisors to resolve distressed retail situations. Specifically, it can:
Acquire Under-Performing Businesses or Divisions
A poorly performing division will have a detrimental effect on the overall business and worsen its financial performance. GA Europe is able to acquire these underperforming assets, either independently or alongside one of its preferred private equity partners. In addition to enabling management to focus its efforts on the group’s core activities, GA Europe is often able to provide a financial commitment that allows the retail business to fund its restructuring initiatives.
Implement Store Closure/Clearance Programmes
With overcapacity a key structural characteristic of non-food retail across Western Europe, store closures will be a consistent retailer response over the next few years. A well-managed store closure programme can help a retail business protect its brand whilst also driving sales and restoring focus on the core business. Drawing on extensive retail and operational resources and expertise, GA Europe is able to develop and execute the entire store exit process, including lease mitigation and stock clearance.
Purchase Distressed Debt Positions
If a corporate lender believes that the risks of continuing to extend a debt facility are too great, GA Europe can provide a viable solution, again either independently or alongside one of its preferred private equity partners. It is able to draw on substantial financial resources to support investment positions with the ability to make an up-front cash payment to acquire debt and related security positions. This may exceed the lender’s assessment of likely recoveries, thereby optimising returns and providing certainty.
GA Europe’s financial strength enables it to provide compelling working capital solutions to stressed or distressed retailers. Generally working alongside established banks, it is able to commit to second lien debt as well as sourcing additional syndicate members.
GA Europe is able to appraise inventory, most commonly to support asset based lending and independent bank reviews. Drawing on Great American’s depth and breadth of experience, the company is able to pinpoint recovery values of all assets on the balance sheet with the exception of marine, mining and rail. And with a vast network in place, it is able to cover hundreds of locations at speed. GA Europe is also on the panel of all the primary lenders.
Relationship with IFT
As a relatively new business in Europe and as a new corporate partner of the IFT, access to the IFT's network of ‘movers and shakers’ within restructuring has been really important for GA Europe. Whilst the company has yet to fully leverage all of the rich content and opportunities which the IFT facilitates, it values its relationship highly and looks forward to deepening the collaboration in the future.
For more information on GA Europe’s services, please contact: