US-based retail restructuring and liquidation giant GA Asset Advisors has arrived in the UK in expectation of continued turmoil in the stores sector.
Sometimes described as an “undertaker” to the high street GA is, along with Hilco and Gordon Brothers, one of the big three operators in the market and has played a pivotal role in generating value from some of the biggest retail collapses. Earlier this year a GA-led consortium ran the closure of US electricals group Circuit City, liquidating Story text.8bn (£1.22bn) of stock.
The UK division, sometimes working with but not exclusively for restructuring specialist Smith & Williamson, expects its initial focus to be on store closures and stock liquidation. Other services include advising on financial restructuring and “accelerated” mergers and acquisitions.
GA Asset Advisors managing director Ryan Mulcunry downplayed the firm’s image as an undertaker. He said: “We try to use the mantra of maximisation of value. We come in at a point where there are few options left and help make difficult decisions. Given the current climate, we have identified opportunities in asset disposition.”
Until now Hilco and Gordon Brothers have been the most prominent retail SWAT teams in the UK. Such companies often co-operate in the US, particularly on large-scale projects and Mulcunry said he would be willing to do so here but that increased competition would help ensure value is realised in liquidations and similar situations. He said: “When you have multiple players you can find the true price.”
PricewaterhouseCoopers business restructuring partner Richard Boys-Stones believed there would be opportunities in the UK for GA but observed that restructuring and liquidation firms operating here had been more successful at winning business in distress situations than from simply underperforming retailers. “The challenge for all of them is to persuade underperformers that they have something to add,” he said.
Since last autumn numerous retail failures and closures have provided work for the liquidators. Hilco, for instance, ran Woolworths’ closing down Sale.