Rescued Retailers: ‘Marcs’ and ‘David Lawrence’
Rodgers Reidy's pivotal role in the successful voluntary administration of two well known fashion labels.
Rodgers Reidy were appointed Administrators to the Group of Companies that designed, manufactured and retailed men's and women's clothing and accessories under the trading names of ‘Marcs’ and ‘David Lawrence’. The Group had 216 stores within Australia and New Zealand, together with an online store.
As at the date of the Administrators' appointment, the Group employed 1,170 full-time, part-time and casual employees including 1,127 across all states and territories in Australia (excluding the Northern Territory) and 43 in New Zealand.
Following their appointment, the Administrators assumed control of the operations of the Group and continued to trade the businesses, whilst a marketing campaign to sell the business was undertaken. The ongoing trading generated a net cash surplus of approximately $1.95 Million.
The marketing campaign resulted in the majority of assets of the Group including all stock and intellectual property rights (brands, trademarks, customer databases, websites, copyrights and patents) being sold to a subsidiary of a major department store. As part of the sale, several leased premises were transferred thereby reducing the claim by landlords and secured creditors in respect to financed store fit-outs, together with the purchase of additional stock held by suppliers.
In addition, the majority of full time and part time employees of the Group accepted an offer of employment from the purchaser, which resulted in a significant reduction of pay in lieu of notice and redundancy from $7.52 Million to $3.285 Million.
As a result of the actions of the Administrators, the employee creditors were paid a dividend of 100 cents in the dollar, with a dividend also paid to unsecured creditors.
Rodgers Reidy Approach
At Rodgers Reidy, we aim to, wherever possible, rescue a company or individual in financial difficulty by designing arrangements that will return commercial viability, will benefit all stakeholders, and which avoid the need for liquidation or bankruptcy.
In circumstances where this cannot be achieved, we will undertake a prompt, equitable and transparent process calculated to realise the full value of the available assets, so as to achieve the highest possible returns for creditors.