Newsletter - Hilco Global

Newsletter
Hilco UK acquires Kraus Carpets
Newsletter Q2 2012
Gunn off like a shot
in the toughest
race on earth
Red Ash Capital Partners, a subsidiary of Hilco
UK, completed the acquisition of floor coverings
manufacturer Kraus in June, marking Hilco’s
second major investment in Canada, following
the acquisition of HMV Canada in 2011.
Waterloo, Ontario-based Kraus is Canada’s
leading exporter of carpets, serving the USA,
Canada, Europe, Australia and parts of the Far
East. The Kraus group of companies has traded
since 1958 with ten manufacturing and distribution
locations in Canada, the USA and Australia including
the group’s 25 acre site in Waterloo (pictured).
Historically, Kraus has traded with
a significant surplus but recent
years have seen the group
struggle due to the decline in US
sales of carpet and flooring, coupled with an excessive
debt burden and an outdated union agreement that
prevented Kraus’ yarn and carpet manufacturing
businesses from operating competitively.
Since its acquisition by Hilco, Kraus has won the
approval of its workforce for a new union contract,
providing the flexibility that the
company needs to compete
in the global market and has
secured significant new funding
lines, marking major progress in the restructuring and
turnaround plans that will enable Kraus to return to
profitability.
Strong end to second quarter for HMV Canada
The team at HMV Canada completed a busy second
quarter on a high note with like-for-like unit sales up
7% in June, driven by a strong new release schedule.
A further boost to sales came from the successful trial
of enhanced Gift & Collectibles and t-shirt ranges in 22
stores. The ranges are due to be rolled out to the rest
of the store estate in September.
Hilco UK was proud to sponsor
John Gunn as he competed in the
27th Marathon des Sables (“the
marathon of the sands”), the
most infamous and demanding
ultramarathon in the world.
The period also saw three new store openings with
the Scarborough, Ontario and St Vital, Winnipeg stores
relocating to improved units in their respective malls
and the launch of a new, pop up store concept in the
Dixie Outlet Mall in Mississauga, Ontario (pictured).
The pop up store, branded HMV Express, is the first
of a series of temporary, seasonal stores that form
a key part of the company’s strategy of adapting its
store portfolio to the changing nature of the market for
physical entertainment media.
Billed as the “toughest footrace on
earth”, the exceptionally gruelling
six day race covered approximately
150 miles through the Sahara
desert. Competitors battled through
rough terrain, including enormous
sand dunes, small mountains and
expansive desert with temperatures
reaching 50C in the daytime and
-10C as the runners camped out
at night.
HMV Canada has also relaunched its customer loyalty
programme, purehmv, on the second anniversary of
the scheme’s inception. Designed to offer the retailer’s
best customers ‘cool stuff money can’t buy’, members
redeem points earned on purchases for exclusive
memorabilia and experiences. A new in store sign up
process has seen registrations increase by 25%.
John completed the race in
one piece – an exceptional
achievement in itself – in just
over 60 hours, raising funds
for Yorkshire Cancer Research.
Wholehearted congratulations to
John from all of the Hilco UK team.
www.hilcouk.com • Tel 020 7317 2050
Newsletter
Allders of Croydon
launches final sale
HRPS helps wholesaler hit the high street
of the Oxford Street store’s prestigious
new World of Shoes women’s footwear
department.
Hilco UK was appointed by
administrators Duff & Phelps in
June to operate a store closing
sale in Allders of Croydon.
Once the flagship of the national
Allders chain, which collapsed
into insolvency in 2005, the
independently owned Croydon
store is one of the UK’s largest
department stores.
Recent years have been particularly
difficult for Allders and Croydon
in general with numerous factors,
such as the failure of the proposed
Park Place scheme and the 2010
riots, intensifying the impact of the
wider economic downturn.
The first days of the closing down
sale have already seen large
queues at the tills as the discounts
and sense of urgency have
tempted reluctant shoppers back
into the store. The administrators
are talking to a number of parties
interested in acquiring parts or all
of the business while Croydon’s
long term future is looking up as
competition between Westfield and
Hammerson to redevelop the town
centre intensifies.
2 Hilco Newsletter Q2 2012
HRPS, Hilco’s property services division,
has worked with the management team of
branded fashion wholesaler 1927 to create
their first 1927 department store concession which
opened in June. The concession in House of Fraser’s
London flagship stocks brands including Kurt Geiger,
See by Chloé and Juicy Couture and forms a key part
The extensive experience of
the HRPS team in managing
new store, concession and
outlet projects for major
retailers and brand owners
resulted in the 1927
concession opening on time
and with a significant 15%
saving compared to the original
budget.
1927’s House of Fraser Oxford
Street concession, with its innovative, playful design, is
trading well despite unforgiving conditions on the high
street and has already garnered considerable interest
from other major department stores.
Denby links up with Imperial War Museums
Denby Pottery announced a partnership with the
Imperial War Museums in May. The collaboration will
see Denby develop a collection of kitchen to table
accessories using unique and
captivating images from IWM’s
archive.
The IWM houses collections
including 15,000 paintings,
50,000 posters and over 10
million photographs which depict
the everyday and the exceptional,
revealing stories of people, places,
ideas and events since the first
world war.
The Eat Your Words! range draws on classic poster
designs from the wartime Ministry of Food that used
bold illustrations and cartoons to educate the public in
healthy eating during rationing. Poster designs featuring
characters such as Doctor Carrot and Potato Pete are
adapted into placemats, melamine trays and mugs.
Speak Your Mind! repurposes
the bold typographic posters that
popularised mottos such as ‘Victory
is in the Kitchen’. The final range,
Wear a Smile!, uses black and
white photographs that tell the
tale of every day wartime life,
including iconic images by noted
photographers such as Cecil
Beaton.
The nostalgic Imperial War Museum
by Denby ranges will launch to the trade in
Autumn 2012 at a range of accessible and attractive
price points.
www.hilcouk.com
Newsletter
Oceans bags another award Twice2much cleans up with
major new business wins
Consumer goods giant
Reckitt Benckiser has
engaged the services of
Twice2much to conduct an
Accounts Payable review.
Oceans Outdoor Furniture was
awarded a certificate of merit for
outstanding presentation by the
Royal Horticultural Society for the
company’s stand (pictured) at this
year’s RHS Hampton Court Palace
Flower Show.
The company’s luxurious PE rattan
outdoor furniture could also be
found in pride of place in the VIP
hospitality suites at this year’s
AEGON Championships tennis
tournament at the Queen’s Club in
London in June.
The world’s largest producer
of household cleaning
products, with a roster of
brands that includes Dettol, Finish
and Cillit Bang, was formed in
1999 by the merger of Reckitt &
Colman and the Dutch Benckiser
NV. Headquartered in Slough with
worldwide sales of £9.5bn and
over 27,000 employees, RB is a
global force in household, health
and personal care.
Twice2much has also been
appointed to undertake Accounts
Payable Recovery Audits for the
131 year old department store
chain Beales, Kirklees Council
in Huddersfield and Europa, a
leading independent property and
infrastructure support services
company.
MIG launches Coalition with a difference New Starter
giant’s coalition email programme.
MIG manages multiple offers from partners and makes
contact directly with consumers to invite them to take
up an offer. The data from partners is de-duped so that
all leads are genuinely new to each partner and also
the partner receives income from any leads generated
from their own data in a compliant way that doesn’t
require third party opt-in.
MIG’s latest service offering, Coalition Marketing,
launched in May. It is the culmination of years
of work developing expertise in data and digital
communications and becoming a data owner as well
as partnering with many leading names to create
a unique email data pool. The idea came about
as a development of a successful seven year long
relationship with Nectar where MIG managed the loyalty
www.hilcouk.com
The results so far have been very positive, particularly
in reactivating old and legacy data for the partners
which is free as part of the service. The revenue
generated for the partners is shared with MIG and the
income to the partner therefore subsidises the cost
of new leads, making it one of the most cost effective
forms of customer recruitment uniquely adding data for
partners, whereas activities used by many such as ‘pay
per click’ advertising do not.
All of us at Hilco are pleased to
welcome Mark O’Neill to the team.
Mark joins Hilco as an Investment
Analyst, having previously worked
for Deloitte’s restructuring services
team in London and Dublin.
Mark’s experience includes
working on a number of trading
administrations in the UK. Mark
also has significant experience
in preparing business reviews on
behalf of lenders of stressed and
distressed companies.
Mark will be a useful addition to
the expanding investment team
and will help support the continued
growth of the business.
Hilco Newsletter Q2 2012 3
Newsletter
Twice2much Africa masterminds community sailing initiative
Cape Town based Twice2much Africa has
launched an ambitious corporate social
responsibility programme. T2M Racing
endeavours to provide opportunities for South
Africa’s schoolchildren to learn to sail, based on
the core belief that sailing provides not only a
sport skill but the opportunity to learn life skills
around safety, responsibility, respect, honesty
and good, clean fun.
T2M Racing organised an outing for young
people from Brownsville Primary School and
Manenberg High School on this year’s Youth
Day in June which saw 40 learners from
underprivileged areas don life jackets and
set sail. 12 of the learners have gone on to
enrol in a formal Level 1 sailing course with
the assistance of various corporate sponsors,
facilitated by T2M Racing.
NEWS FROM ACROSS THE POND
Hilco Merchant Resources, in connection with
joint venture partners, conducted store closing
sales in 184 retail outlets across the USA and
Canada in the second quarter.
Betsey Johnson, a designer, manufacturer and
retailer of women’s apparel and accessories
used HMR to monetize more than $26 million of
inventory in 69 stores.
HMR liquidated more than $260 million of
inventory in 52 locations for Zellers, a chain of
discount department stores in Canada. Following
the success of this project, Zellers has appointed
HMR and its partners to monetize a further $211
of merchandise in 28 stores.
The closure of home furnishings retailer
RoomStore’s 35 outlets has monetised more than
$21 million of inventory to date.
Hilco Real Estate was engaged by several retailers
to assist in the disposition of leases. HRE’s work for
American TV & Appliance enabled the client to exit
underperforming locations and avoid bankruptcy.
Coffee shop giant Starbucks retained Hilco Real
Estate to manage the restructuring or disposal of over
2,500 leased locations throughout the US and Canada
following a successful trial where HRE disposed of 200
unprofitable stores. To date, HRE has saved Starbucks
in excess of $60 million and remains the company’s
primary third party real estate firm for North America.
Hilco Industrial hosted 40 live and online auctions
from April through June in the US, Canada and Europe.
Industries served included paper, power, solar, steel,
electronics and automotive.
New business wins in South Africa
Twice2much Africa has been
appointed to conduct two new
accounts payable reviews for major
companies in South Africa.
Established in 1996, Associated
Motor Holdings is part of the
Imperial Group which has an
annual revenue of 38.4 billion
rand (£3 billion). AMH provides
sales and service for nine car
manufacturers, focusing on
bringing new and alternative brands
and models to the South African
market.
Invicta Holdings is an investment
holding and management
company, controlling and managing
assets of 8.4 million rand. Its main
assets include Bearing Man Group
and Captial Equipment Group.
In the solar sector, HI worked with Solyndra, UniSolar, Maricopa and REC. HI also won the contract
to handle the sale of three state-of-the-art REC
wafer silicon fabrication facilities in Norway, totalling
over 850 MW/yr manufacturing capacity.
Projects for the paper industry included work for
St Mary’s Paper, Smart Paper and Sun Times
Media while the steel industry brought projects
from Structural Steel Fabricators, Globe Iron and
Isaacson Structural Steel.
Hilco Industrial continues to show strength in the
automotive sector with successful auctions for
Automotive Component Holdings, General Motors’
Canadian Racer and UBE businesses, Ford’s
engine facility in Bordeaux, France and Magna
Powertrain’s new process gear facility in Syracuse,
New York.
Contact Directory
Burleigh
www.burleigh.co.uk
01782 577866
Clipper Marine
www.clippermarine.co.uk
020 7054 7880
Denby
www.denby.co.uk
01773 740 899
Hilco Iberia
+34 630 838 644
Hilco Ireland
www.hilcoireland.com
+353 (0)1 631 9222
Hilco UK
www.hilcouk.com
020 7317 2050
Hilco Deutschland
www.hilcodeutschland.com
+49 211 5403 9627
HFS
www.homeflooringsolutions.co.uk 01689 895 895
MIG
www.m-i-g.com
01565 653 000
Oceans
www.oceansint.com
0845 519 7686
Park
www.parkltd.co.uk
01305 778 420
Twice2much
www.twice2much.com
0844 225 2090
Published by Hilco UK Limited, 80 New Bond Street, London W1S 1SB · Tel (0)207 317 2050 · Fax (0)207 317 2051 · © 2012 Hilco UK Limited · All rights reserved
4 Hilco Newsletter Q2 2012
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