London – DLA Piper has advised a banking syndicate on the insolvency of Adams Childrenswear Limited, Adams Property Holdings Limited and Mini Mode Childrenswear Limited. This is the latest deal for the restructuring team who have been involved in a number of high-profile retail insolvencies in recent months.
On 1 February 2007, the immediate sale of the majority of the business and assets of Adams Childrenswear Limited (“Adams”) to a newly formed company backed by retail entrepreneur, John Shannon was announced following the appointment as joint administrators of Rob Hunt, David Hargrave and Michael Jervis of PricewaterhouseCoopers LLP. Adams had a UK store portfolio of around 330 stores and as a result of the transaction 273 stores will continue to trade. The costs of closing the remaining 57 severely loss-making stores was too great for the group to deal with outside of a formal insolvency process.
DLA Piper advised the banks on the appropriate structure for the transaction which involved a careful analysis of the contractual position of the group. A multi-disciplinary team was involved in reviewing the leases for a substantial leasehold portfolio together with obtaining intellectual property input on the groups’ IP portfolio. These issues had to be dealt with in a short timeframe.
Simon Neilson-Clark, partner and head of DLA Piper’s Restructuring Group, commented: “This was a good opportunity for DLA Piper’s restructuring team to demonstrate that we are the advisers of choice when it comes to dealing with retailers in financial distress. This instruction is just one of a number of retail related matters that the team have been involved with recently such as Allders, MVC, Music Zone, Little Chef and The Greeting Card Group.”
The DLA Piper team included Jonathan Leitch, Lucy Skidmore, Finella Fogarty, Sarah Davison, Nick Peters (Restructuring), Tracy Fisher (Tax), Zoe Ham and Louisa Copeman (TMC) and Kate Hodgkiss and Eleanor Winslet (Employment).
The bank syndicate was led by Barclays Bank PLC and also included: Halifax Bank of Scotland; Allied Irish Bank; The Royal Bank of Scotland and Barclays Bank PLC.