Integrated Solutions to Maximize the Value of Assets June 08, 2016
Integrated Solutions to Maximize the Value of Assets
June 08, 2016
• An independent financial services company providing Valuation,
Monetization and Advisory services for all tangible and intangible assets
• The world’s preeminent authority in assisting healthy and distressed
companies and their constituencies derive maximum value from assets
• The holding company for twenty integrated business units delivering
expert solutions and proven value on every engagement for 30 years
• A privately held and financially successful organization willing to put
capital at risk and guarantee results in connection with transactions
What is Hilco Global?
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MonetizationValuation Advisory
• Tangible and Intangible Asset Appraisals:
› Inventory
› Machinery & Equipment
› Real Estate
› Accounts Receivable
› Intellectual Property
• Enterprise Valuations:
› Fairness & Solvency Opinions
› Quality of Earnings
• Portfolio Valuations
• Due Diligence Services
• Valuations for Tax, Reporting, Accounting
and Compliance Requirements:
› FAS 157, 141, 142
› IFRS Compliant Valuations
• Retail/Wholesale Assets: Disposition and Acquisition of Inventory, Fixtures and Equipment, Real Estate, Intellectual Property and Debt Instruments
• Industrial/Manufacturing Assets:Disposition and Acquisition of Machinery, Equipment, Inventory, Rolling Stock, Real Estate, Debt Instruments
• Commercial and Institutional Real Estate:Disposition and Acquisition of Real Estate; Principal investments and sale; Restructuring
• Accounts Receivable: Acquisition and Collection of Commercial Accounts Receivable Portfolios
• Intellectual Property: Intangible Assets Including Patents, Brands, Trademarks, Domain Names, IPv4
• Facility Demolition and Repurposing: Acquisition of Industrial and Manufacturing Sites for Repurposing
• Private Equity:Principal investment and operations for strategic businesses, brands and turnaround situations
• Retail Performance and Profit
Enhancement Strategies
• Real Estate Asset Restructuring
• Asset Security and Protection Services
• Brand Revitalization and Licensing
Strategies
• Litigation Support Services
Proven Customer Solutions
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VALUATION(APPRAISAL SERVICES)
MONETIZATION
ADVISORY(CONSULTATIVE SERVICES)
Hilco
Industrial
Hilco
Capital
Hilco
Streambank
Hilco
Real Estate
Hilco
Redevelop.
Partners
Hilco
Receivables
Hilco
Valuation
ServicesHilco
Retail
Consulting
Hilco
Brands
Hilco
Merchant
Resources
Hilco
Global
Hilco Redevelopment Partners• Acquisition of industrial & manufacturing sites
for repurposing
Hilco Valuation Services, LLC• Tangible and intangible asset appraisals
• Inventory, M&E, Real Estate, Receivables,
and IP
• Business Valuations
• Insurance/Tax Valuations
• Asset Verification and Tagging
• Compliance – Ad Valorem
• Due Diligence Services
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Serving Clients on Five Continents
Los Angeles
Oakland
Mexico City
São Palo Dubai*
*Joint Venture Offices
Melbourne
Singapore
Bangkok
Tokyo*
Hong Kong
Dusseldorf*
Paris*
London
Leeds
Boston
New York
Toronto
Detroit
Grand Rapids
Chicago
Charlotte
Atlanta
Birmingham
Sydney
Madrid
Dublin
Amsterdam
Mumbai
US Chicago • Detroit • Grand Rapids
New York • Los Angeles • Boston
Oakland • San Diego • Birmingham
CANADA Toronto
UK London • Leeds • Birmingham • Dublin
ASIA PACIFIC Singapore • Hong Kong • Bangkok
MEXICO Mexico City
BRAZIL São Paulo
AUSTRALIA Sydney
NETHERLANDS Amsterdam
03/025
Hilco Global Customer Experience
Global Customers Retail Customers
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Hilco Global – Broad Platform of Financial Services
1. Strategic partnerships providing management expertise and consulting in both opportunistic
and distressed situations:› One North LaSalle
› Hostess brand turnaround
› Starbucks strategic real estate and lease repositioning services
2. Principal and operator of strategic businesses and brand investments:› Purchasing and revitalizing the 75 year old Polaroid brand
› Re-launching and expanding the iconic Halston, Haute Hippie, Le Tigre retail fashion brands
› Purchasing and revitalizing Kraus Flooring
› Buying and restructuring HMV – a billion dollar music/entertainment retailer in UK, Canada, Ireland
3. Buyer/seller of all assets: A/R; Inventory; Real Estate; Industrial Equipment; IP:› A&P; Radio Shack; Coldwater Creek – acquired IP and disposition rights of all retail assets and real estate
› Partnered with Cenveo to purchase National Envelope by acquiring non-strategic assets
› Acquisition and redevelopment of the 17 million square foot steel mill owned by RG Steel on 3,100 acre site
› GM and Chrysler assembly and manufacturing plants
› One North LaSalle; The Gauge Development in Boston
4. Recent Private Equity Firm deal strategic/investment partnerships:› The Carlyle Group
› Garrison Capital
› Redwood Capital
› Ares Capital
› Blackrock
› Atlas Capital
› Sycamore Capital
› Catterton Partners
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Recent Portfolio ExitsCurrent Equity Investments
Consumer ProductsUnited States
RetailerCanada
Consumer ProductsUnited States
RetailerUnited Kingdom
RetailerUK- Europe
RetailerUnited Kingdom
RetailerUnited States
Consumer ProductsUnited States
Engineered LabelsUnited States
Apparel Design & ManufacturingCanada
ApparelUnited States
RetailerGermany
ApparelUnited States
Floor CoveringsUnited Kingdom
Consumer ProductsUnited States
Consumer ProductsUnited States
Audio ElectronicsUnited States
RetailerFrance
Boat DistributorUnited Kingdom
Market ResearchUnited States
TablewareUnited Kingdom
ApparelUnited States
RetailerUK, Canada & Ireland
Floor CoveringsCanada & USA
Scholarship ProgramUnited States
Premium Natural ProteinsUnited States
Consumer ProductsUnited States
RetailerUnited States
Natural Proteins ProcessingUnited States
DVD Game RetailerUnited Kingdom
Consumer ProductsUnited States
Consumer ProductsUnited States
Consumer ProductsUnited States
Consumer ProductsUnited States
ApparelUnited States
ApparelUnited States
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Critical Facts about Hilco Global
World class scale and scope of service:
• Recognized, hands-on management team
• Best in Class talent and financial resources
• Centralized global coordination of the process with local service
• Sold assets from 53 countries into more than 60 countries in 2015
Most experienced with assets to be valued and sold:
• Asset sales exceeded $1.5 billion in 2015
• Converted over $170 billion of excess retail inventory to cash
• Mitigated in excess of $1 billion lease liability for hundreds of clients
• Disposition of 200 million SF of retail, office and industrial properties
• Appraised and repositioned real estate worth nearly $4 billion
• Delivered nearly 20,000 appraisals - values in excess of $200 billion
* Capital available for immediate monetization and risk mitigation
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Hilco Valuation’s Bench Strength
We employ over 150 people in our valuation practice:
• 70 tangible and intangible asset appraisers on staff with an average of 15
years experience
• 30 financial analysts and research analysts/editors on staff
• Valuation offices in the US, Canada, Mexico, Australia, UK (covering Europe)
and Singapore (serving Asia)
Our valuations are reinforced through asset disposition capabilities:
• Our heritage is in asset disposition - we understand market values
• Our appraisal values are based on our expertise and proprietary market data
• Hilco’s disposition units cover all tangible and intangible asset categories
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Hilco Valuation Services: Our Structure
Asset Appraisal
• Inventory
• M&E
• Receivables
Enterprise Valuation
• IP Appraisals/BV
• Financial Opinions
• Portfolio Valuations
Real Estate
• Appraisals
• Feasibility Study Analysis
• Property Tax Consulting
Streambank/IP
Merchant Banking
• IP Monetization
• IP Advisory/Licensing
• IPv4 Market Maker
Diligence Services
• Field Examinations
• Transaction Diligence
• Forensic Analysis
UK/Europe/Aus
• Appraisals & Field Exams
• Insolvency Valuations
• Dispositions
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Aerospace & Defense Chemical Processing Construction Hi-Tech
Automotive Plastics Transportation Food Processing
Metalworking Fabrication Foundries & ForgingsMetalworking CNC
PharmaceuticalsPrinting Pulp & Paper
Glass & Ceramics
Retailing
Expertise in a Wide Range of Asset Categories
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Hilco Streambank Capabilities
• Industry-leading IP advisory firm serving both healthy and distressed clients
• Specialization in the Appraisal, Valuation, Marketing, Sale and Acquisition of
intangible assets such as:
• Extensive record of success in identifying and maximizing tangible value
from intangible assets
› Trade Names/Brands
› Trademarks
› Patents
› License Agreements
› Royalty Streams
› Databases/Customer Lists
› Trade Secrets
› Copyrights
› Internet Assets
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Representative Cases:
Hilco was retained to oversee the going-out-of-business sales with joint venture partner, Gordon Brothers. After 25
years of providing value-priced women’s clothing and accessories, Dots filed for chapter 11 bankruptcy protection in
January of 2014. The fashion discount retailer closed 243 stores nation-wide and had discount offers of up to 30%
off all merchandise. Along with the discount sales at retail locations, the Dots customer database contained over 6.9
million customer records and various domain names. Hilco Streambank was soon brought along to help market and
sell the various intellectual property assets.
Hilco Streambank, acting on behalf of a joint venture of Hilco Merchant Resources served as the exclusive agent for
the sale of dELiA*s intellectual property. The teen fashion retailer was started in 1993 and recorded sales of over
$100 million from 2011-2013. The company filed for bankruptcy protection in December of 2014 and soon after
commenced its liquidation process. dELiA*s customer database contained over 4.9 million individual records,
which drastically increased the value of its e-commerce platform. Hilco Streambank handled intellectual property
sales involving assets such as customer databases, domain names and trademarks.
Simply Fashion filed for chapter 11 bankruptcy protections after the beginning of 2015. Hilco Streambank was hired
to help manage the sales of the intellectual asset portfolio. Hilco Streambank quickly assessed the situation and
enacted a strategic approach to spreading awareness of the assets available for sale.
Hilco Streambank found a buyer and was able to close the sale.
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Following liquidation of certain intangible assets of the electronics retailer, Hilco was retained to sell trademarks and
domains associated with RadioShack including: RadioShack.com, Tandy.com, TheShack.com and Ignition.com, the
Company’s franchise and dealer network and infrastructure, and the Company’s Global Sourcing Business. RadioShack
generated proceeds of approximately $40 million from the sale of its intellectual property assets.
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Hilco IP Merchant Banking
Hilco IP Advisors
(IP Advisory)
M&A Financing
Valuation Strategy
Patent Brokerage
IP Special Situations Research
Hilco IP Alpha Funds
(IP Asset Mgmt)
IP Management Investments
IP Special Situations
Investments
Hilco IP Management
(IP Monetization)
Owned Portfolios
Portfolios Managed by Third Parties
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Monetization Options
Option I: Sell-Side (Brokerage) Option III: AssertionOption II: SPV Financed
Patent sales to an NPE or strategic
involving a combination of upfront cash
and a back-end revenue share. In
certain instances, an NPE may be
willing to offer a large upfront amount in
lieu of a back-end share.
Patent ownership maintained under
the HPQ brand or a subsidiary SPV.
Third party monetization experts or
contingent fee law firm fronts the
monetization cost for a back-end
share. (Typically 50%).
Patent ownership transferred to a new
SPV run by a third party monetization
team. The purchase price and SPV
operating expenses are financed, and
returns to the initial patent owner take
different forms.
Advantages
• Simplified transaction
• Upfront revenue
• Can negotiate back-end
• Little long-term internal diversion
Advantages
• Financing not necessary
• Litigation expense transfer
• Maintain ownership of IP
Advantages
• Flexible risk-return profile
• Discreet licensing
• Strong financial backer
• De-risk
• Eliminate monetization expense
Disadvantages
• Reduced upside potential due to risk-transfer
• Loss of internal IP (License-back)
• Loss of defensive position
Example
• IP monetization firms/teams that purchase portfolios and run multiple programs across various industries.
Disadvantages
• Portfolio maintenance cost retention and upfront $
• Negative monetization press linked to brand
• 20%-50% revenue share
Example
• Third party monetization agents and contingent fee law firms known for variety of assertion transactions. HPQ may be familiar with this model.
Disadvantages
• Investment profile requires stricter diligence
• Portfolio must have marketable story
Example
• SPV’s have been structured on the basis of outright sales, large upfront $/small back-ends, or small upfront $/large back-ends.
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Hilco Real Estate
At HRE we advise and execute strategies to help both healthy and distressed clients maximize
the value of their real estate assets. Extensive property valuation knowledge, lease restructuring
experience and creative sales strategies are leveraged by a vast network of tenants/landlords and
motivated buyers/sellers and substantial access to capital.
Lease Repositioning and Advisory Services
• Mitigation of leasehold obligations through: Rent Reduction, Renewal, Termination and or Sublease/Assignment
• M&A portfolio optimization advisory
Disposition Services
• Traditional brokerage – all property types
• High-performance accelerated property auctions – live, online, sealed bid
• Sale/leaseback advisory
• Unique deal structuring, including leveraging our capital
Real Estate Investments
• Acquisitions - vacant, value-add, or stable income-producing properties
• Joint venture transactions that often include the acquisition of both real estate and non-real estate assets (e.g., machinery & equipment)
• Sale/leaseback
• Lease designation rights
Special Situations
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Representative Cases
In late 2012 Hostess Brands announced it was shutting down its business and selling all assets. Hilco was appointed exclusive
real estate advisor early in the process, initially valuing all 260 owned locations. After 120 were sold as part of a combined
brand/asset purchase of certain brands, Hilco handled the sale of the remaining 140 diverse real estate assets across 34 states.
Hilco quickly implemented a highly innovative and effective marketing campaign consisting of print advertising, website listings,
electronic media, public relations and signage. Within approximately 90 days, over 6,000 prospective buyers had responded,
which led to over 400 offers. Ultimately the portfolio (which included the real estate, machinery and equipment and thousands of
trucks) was sold in a bulk transaction at auction to the stalking horse bidder, which yielded the estate over $62 million in
proceeds.
Hilco was initially retained to terminate and/or restructure approximately 50 Starbucks locations that became strategically
unimportant and/or unprofitable. Since achieving significant success for the company with this initial program, Hilco has
been involved with the restructuring/renewal and/or termination of close to 3,000 additional leased locations throughout
the U.S. and Canada. Through our efforts to date, Hilco has saved the company in excess of $75 million, while
concurrently restructuring critical non-economic provisions within countless leases. Hilco continues to serve as the
primary third party real estate firm for Starbucks throughout the U.S. and Canada.
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HRE has represented A&P for over eight years in connection with numerous initiatives. Notably, during the company’s 2011-12
bankruptcy, HRE was engaged by the company to assist with the restructuring of 300+ leases throughout the northeastern U.S.,
most of which we determined to be materially below market, while concurrently disposing/selling 50+ non-core leases. Through
its efforts, HRE achieved rent savings in excess of $50 million and sales proceeds in excess of $65 million.
In the most recent engagement, which is being finalized in Q1 2016, HRE was hired to assist A&P (including Food Basics,
Waltbaums, Food Emporium, Pathmark and Superfresh Stores) with the lease assignment/sale of approximately 275 operating
stores and other leasehold assets. The project scope also included 15 parcels of owned property and other assets such as
liquor licenses/stores, scripts, inventory and FF&E, and IP. The HRE team is an integral strategic and transactional advisor to
A&P and its constituents and has been the lead disposition agent in securing in excess of $1.1 billion in proceeds to date.
HRE Acquisition/Investment Deals
• A value added and opportunistic real estate redevelopment that provides superior risk‐adjusted returns
• Disciplined investment approach includes thorough qualitative and quantitative analysis
• Primary asset classes include Industrial and Office; secondary asset classes include Retail and
Multi-Family
Waterton, MA Distribution Facility: This was an 94,268 SF underfunded and mismanaged property that required physical improvements and updates/upgrades. The market dynamics in the Boston area were strong and we felt that it warranted investment to attract tenants / users. HRE invested in upgrades, architectural renderings and space plans to make it marketable and engaged municipal officials for support (i.e. zoning) HRE fully leased the building within the first nine months of ownership, increasing the Net Operating Income.
Sony Facility, AL: Buying an obsolete/older property sold through a corporate liquidation (bankruptcy or receivership). This was a
Large properties (1 million square feet +) with significant infrastructure (heavy steel construction, limited brick / concrete). The
facility had above grade environmental issues but HRP felt we could find a way to execute a sale leaseback on this property that
was at the end of its current use.
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One North LaSalle, Chicago, IL: Hilco acquired One North LaSalle for $83M. Hilco views this as a great investment
opportunity with the 47-story, 500k SF building. The building is in a great location in the Central Loop and will be attractive
address for tech, advertising and media companies. Hilco’s redevelopment plans call for remodeling the building's lobby,
restrooms and tenant corridors. A new rooftop deck is planned, and a fitness room will be built on the fifth floor.
Boston, MA – Exelon Power Plant: Buying an obsolete/older property sold through a corporate liquidation (bankruptcy or
receivership). This was a Large properties (1 million square feet +) with significant infrastructure (heavy steel construction, limited
brick / concrete). The facility had above grade environmental issues but HRP felt we could find a way to execute a sale leaseback
on this property that was at the end of its current use.
Hilco Redevelopment Partners
A single integrated solution to maximize the value of obsolete industrial sites
• Provide capital to guaranty completion of all project phases
• Complete all remediation to regulatory standards
• Monetize all assets, including receivables, inventory and PP&E
• Redevelop sites in a socially responsible manner
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Experience
• Hilco Global has redeveloped over 36.7M SF of industrial property and facilities since
2011; more than any other firm in North America
Property Name City, State Former Use Structure Size (SF) Year
Warren Warren, OH RG Steel Mill 8,000,000 2013
Mansfield Ontario, OH GM Stamping Plant 2,500,000 2012
Sparrows Point Sparrows Point, MD RG Steel Mill 17,000,000 2012
Cooper Tire Albany, GA Cooper Tire Manufacturing 2,200,000 2011
Sony Dothan, AL Sony Manufacturing Plant 1,000,000 2011
Pontiac Pontiac, MI GM Truck/Bus Assembly 3,500,000 2011
Wyoming Wyoming, MI GM Stamping Plant 2,500,000 2011
Total 36,700,000
HRP is the leader in redeveloping the largest and most complex industrial sites
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Hilco Repurposes Historic Industrial Site
Hilco Redevelopment Partners acquired the RG Steel Sparrows Point steel mill in September
2012 for $70 million following emergence from bankruptcy. The 3,100 acre, 17 million square
foot complex, located in Baltimore, MD on the shores of Chesapeake Bay, had previously
operated as Bethlehem Steel and was once the world’s largest steelmaking complex. Hilco
Global purchased all of the above ground assets including machinery and equipment and
improvements.
HRP maximized the value of this obsolete industrial site by leveraging its multiple capabilities to
create a unique solution while addressing the requirements of many stakeholders. Machinery,
equipment, rolling stock and inventory were sold to buyers around the world. Work began to
demolish structures and other obsolete infrastructure, which would be removed and recycled.
Preliminary work also began on the clean up and environmental remediation of the land, tainted
by 100 years of steelmaking, to current regulatory standards.
Late in 2014, Hilco Global and a private equity firm partnered to start Phase II of the project to
form Sparrows Point Terminal LLC. The new entity acquired the property and will continue site
clean-up and remediation work as the precursor to building new infrastructure for the planned
tri-modal logistics center.
In 2015 the new redevelopment of the site has begun with new branding – TradePoint Atlantic
serving as a major port and logistics center for the East Coast of the U.S. creating thousands of
jobs. In January 2016, FedEx announced it will build a new distribution center on the site.
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Hilco Industrial - Overview
The Worlds Largest, Most Experienced Multi-Class Industrial Asset Disposition Company
• Hilco Industrial HQ – Detroit/Grand Rapids
• Hilco Industrial Europe – UK/ Netherlands
• Hilco Acetec – Mexico
• Hilco Industrial – South America – Brazil
• Hilco Industrial – Asia Pacific
Global Network of Buyers and Sellers
• Database to locate qualified prospects for all equipment
Multi-Faceted Sales Options
• Holistic Approach to Disposition - Hilco Global Integration
Flexible Financial Structuring
• Specialized options include purchase of assets; guarantees, commission, etc.
Experienced, Highly Specialized Team
• Industry specialist with 30+ years average experience
At Hilco Industrial we advise and execute strategies to assist industrial and manufacturing clients
maximize the value of their machinery and equipment assets around the world.
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Representative Deals and Transactions
Disposition of machinery and equipment in (16) General Motors and (5) Chrysler production plants
involving 75 million square feet of space and more than 100,000 discrete pieces of M&E.
Purchase of complete gear manufacturing facility featuring high precision CNC equipment.
Employed several sale methodologies including private treaty sales and auction sale to sell
manufacturing equipment. Currently marketing real property.
Complete disposition of all surplus metal fabrication and electronic assembly equipment located in
(3) plants, totaling 500,000+ square feet in Nogales, Mexico. Project completed in approximately 60
days.
Largest bankruptcy auction for transportation assets and public works vehicles for the City of Detroit.
Contracted by the Electronics Business Unit to dispose of surplus manufacturing assets. Conducted
(2) sales in Q4 2012 in Melville, NY and Sunnyvale, CA. Both facilities were cleared of all surplus in
under (30) days from start of project.
Acquisition and phased sale of substantially all of the assets of a complete nutraceutical
manufacturing facility & agricultural research farm.
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Hilco Merchant ResourcesBrick & Mortar • E-Commerce
Hilco Fixture FindersLozier Retail Shelving Inventory • Clean-out & Distribution Services • Warehousing and Storage
Furniture, Fixtures & Equipment • Retail • Warehouses • DC’s • Rolling Stock
Hilco Asset ProtectionAsset Protection • Site Protection • Background Screening
Hilco Wholesale SolutionsConsumer Products Inventory
Hilco Merchant Resources – Complete Retail Solutions
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Hilco Merchant Resources
Analytical, advisory, operational, asset monetization and capital investment activities
to help retailers define and execute their strategic initiatives
Activities fall into six principal categories:
1. Strategic store closings including facilitating the rationalization of a retailer’s store portfolio
2. Retail company or division wind-downs
3. Facilitation of mergers, acquisitions, and divestitures by taking on unwanted retail assets and/or
liabilities
4. Interim management of retail companies or divisions
5. Special event sales including a customized sale within a store and pop-ups
6. Acquisition of debt to obtain control of the retail business
In all categories, HMR can structure the transactions to guarantee results and
commit capital
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Representative Cases
HMR was assigned the lead role and responsibility to manage complete store closing and clearance programs
for over 2000 retail stores across the US, Canada and Mexico.
Hilco is managing a progressive markdown clearance program, which is their national clearance program, for the
Company at all 918 stores, embracing $210 million at cost in clearance inventory over approximately 20 weeks.
Awarded this transaction to liquidate all 350 stores and approximately $100 million in cost inventory, intellectual
property and furniture, fixtures and equipment.
In 2015 Hilco Merchant Resources was hired to manage the inventory disposition and store closing process for
all City Sport retail stores. The 12-week process included successful sales for the chain which operated 18 retail
stores that carried high end sporting goods including popular brands such as Under Armour, Nike, Marmot,
Patagonia, The North Face, ASICS and Brooks. HMR was also responsible for all store fixtures, furniture and
equipment.
Hilco Merchant Resources secured approval from Target Canada and an order from a Canadian court to
manage the store closing process for Target’s 133 Canadian locations early in the first quarter of 2015. HMR
leveraged its substantial skills and understanding of the North American retail marketplace and developed a
strategy that would allow target to maximize the value of over $800 Million dollars’ worth of retail inventory.
Additionally, Hilco Merchant Resources and Hilco Fixture Finders were responsible for selling the store fixtures
and equipment.
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Hilco Receivables is a recognized leader in the collections industry providing
innovative and successful collection techniques across all types of portfolios
and sectors.
Commercial Accounts Receivable Portfolios
• Fee Basis
• Purchase
Purchase Charged Off Consumer Debt
• Credit Cards
• Student Loans
• Health Care
• Installment Loans
Hilco Receivables Services
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• Monetization of purchased and fee based commercial receivables in
excess of $400 million
• Management of over 50 commercial receivable deals since 2001
• Principal investments totaling over $500 million and $10 billion in assets
acquired
Serving the following financial institutions:
Hilco Receivables Delivers Results
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Overview of HRC Advisory
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HRC Advisory is a leading boutique retail consulting firm. Our Principals have been
creating substantive value for retailers and retail portfolio investments for financial
sponsors and secured lenders for more than 25 years.
› Total focus on helping retailers enhance performance by creating and
implementing practical changes that bring practical, real value to increase
profitability
› Provide retail specialists in critical functions including corporate support
operations, merchandising profitability, strategic planning, operations and
logistics/fulfillment
› Take a “big picture” strategic view and a practical execution mindset
HRC Advisory Consulting Clients and Services
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Retail Performance Improvement
• Organizational Redesign and Change
Management
• Merchandising and Inventory Management
› Category Management
› Planning & Allocation/
Assortment Planning
› Replenishment
› Markdown Effectiveness
• Indirect Procurement
• Distribution and Logistics
• Post Merger Integration of Operational
Functions to Drive Synergies
• Store Operations
› Field & Store Supervision
› Increasing Sales Using Traffic and
Conversion
› Labor Planning & Scheduling
› ROI Unlocked by Consistent Execution
• Cost Containment and Redirection
G&A Expense
Finance Function Optimization
IT Effectiveness
Energy and Telecommunications
Sample of Key Retailers Our Team has Advised
The Hilco Global
Client Cases
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CONFIDENTIAL – NOT TO BE DISTRIBUTED
This presentation contains material that is not for public or private distribution without
authorization. The material contained within is concerning the business operations, financial
structure and case histories which should be treated as private and confidential. As a
recipient, it should be used for the sole purpose of understanding the capabilities and
experience of Hilco Global. All recipients agree to take reasonable precautions to maintain the
confidentiality and to inform its employees of the confidential nature of the material. The
recipient shall not disclose the material to any third party without the prior consent from Hilco
Global.
Additionally, all material, examples and case histories included herein are being included for
discussion and illustration purpose only. The case studies are intended to provide an
understanding of past engagements and/or investments and not necessarily representative of
any future performance. Furthermore the information contained in such case studies is not
complete, may be subject to change and excludes any confidential or non-public information
available.
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Hilco Global Maximizes the Value of Hostess Brands
Following multiple bankruptcy filings, Hostess Brands, Inc. announced in late 2012 that it was shutting
down its business and selling all of the company snack cake and bread assets, including inventory,
machinery and equipment, rolling stock, real estate, and intellectual property. Hilco Global was hired by
the company to provide an integrated solution for maximizing asset values, which included the expertise
of multiple Hilco business units and $30M of capital needed to fund operations during the bankruptcy and
sale process.
As an exclusive sales agent and asset advisor, Hilco Global first valued the assets, including bakery
equipment, rolling stock, real estate and intellectual property such as iconic brands like Hostess and
Wonder Bread. A shutdown and sale process ensued, during which Hilco Global also provided security
protection for the hard assets.
One of the more formidable challenges was managing the disposition of over 260 owned real estate
locations. Following the bulk sale of 120 locations as part of a combined brand/asset purchase, Hilco
implemented a highly-innovative marketing campaign to quickly sell the remaining 140 locations across
34 states. Included were print advertising, website listings, electronic media, public relations and
signage. Within approximately 90 days, over 6,000 prospective buyers had responded, which led to over
400 offers and completion of the sale.
Ultimately, the entire asset portfolio was sold, yielding millions of dollars to bankruptcy creditors. Hilco
Global participation was considered instrumental in helping to sell the company to two strategic buyers for
almost $800 million.
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Hilco Global Revitalizes Iconic Brand
Polaroid, the iconic brand known around the world for pioneering and perfecting instant photography,
experienced a sharp decline in demand resulting from the evolution of digital imaging technology in the 1980s.
The company filed for Chapter 11 bankruptcy in 2001.
After others made several failed attempts to revive the company, in 2009 Hilco Global acquired the intellectual
property and other assets of Polaroid following a second bankruptcy filing. The acquisition included a material
investment by Hilco Global and PE Partners and an equity stake for the bankruptcy estate of the then Polaroid
Corporation (now PBE Corp.).
A new management team, lead by President and CEO, Scott W. Hardy, worked in concert with Hilco Global to
completely transform the company. All manufacturing operations were ceased and the company instead
focused on product innovation and building a global licensing platform for the Polaroid brand. Currently, over
50 best-in-class licensees across the globe have developed and are marketing a broad range of Polaroid-
branded consumer electronics products, including instant and digital still cameras, lifestyle action sports
cameras, tablets and flat screen TVs. Innovative products such as the Polaroid Cube continue to break
through established barriers, bringing ease-of-use, sharing and fun to consumers. Polaroid branded products
are now sold in over 100,000 retail stores in more than 100 countries.
Late in 2014, Hilco Global announced the addition of the Minneapolis-based Pohlad Family Capital Fund
(PFCF) as an investor and partner in the current Polaroid deal. The addition of a new capital partner marks
the next phase of the company’s evolution after a successful five year effort to re-establish Polaroid as the
preeminent brand for instant photography and related consumer electronics.
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Hilco Global Acquires National Envelope
With eight plants and two distribution centers capable of producing 37 billion envelopes a
year, National Envelope was the oldest and most respected brand in the envelope industry in
the United States.
In May of 2013, the envelope giant filed for Chapter 11 Bankruptcy. The envelope maker
sought Chapter 11 protection on June 10 for the second time as the Internet supplants mail
for communications. The Frisco, Texas-based company listed as much as $500 million in
both assets and liabilities. Private-equity firm Gores Group LLC bought virtually all of
National Envelope’s assets in its first bankruptcy at an August 2010 auction for about $208
million.
Hilco Receivables was approached by Cenveo, a large competitor of National Envelope in
the printing and manufacturing space who was in need of additional capital in their effort to
purchase the business out of bankruptcy. The Hilco team structured a transaction to partner
with Cenveo on the acquisition of the National Envelope business by providing additional
financing in the form of an acquisition of the A/R of the company. Having the unique
understanding of the value of the A/R assets, Hilco was not only able to empower Cenveo to
complete the transaction but also helped save thousands of jobs.
After delivering the financing, Hilco then partnered with Cenveo and Southern Paper to
acquire National Envelope and all of its assets out of a bankruptcy for a total of $70 million
dollars.
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Global Headquarters:
5 Revere Drive
Northbrook, IL 60062 USA
www.hilcoglobal.com
Chicago | Boston | Detroit | Grand Rapids | New York | Los Angeles | Atlanta | Birmingham | Charlotte | Oakland
Phoenix | Seattle | San Diego | United Kingdom (London, Leeds, Birmingham) | Toronto | Mexico (Mexico City,
Guadalajara, Monterrey, Villahermosa, Irapuato) | Sao Paulo | Singapore | Hong Kong | Bangkok | Sydney
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Hilco Valuation Services, LLCTom Greco, CEO
Hilco Enterprise Valuation
Services, LLCJason Frank, Managing Director
Hilco Real Estate Appraisal, LLCTodd Haney, CEO
Hilco Litigation Support, LLCJason Frank, Managing Director
Hilco Diligence Services, LLCDoug Jung, Managing Director
Hilco Appraisal Asia-PacificSupanit Chaiyawat, CEO AsiaFrancis Yau, CEO Greater ChinaAllan Sim, EVP Asia-Pacific Region
Hilco Valuation AustraliaBrendan Smyth, Managing Director
Hilco Valuation EuropeChris Hall, CEO
Hilco Brands UKJeff Branman, Managing Director
Hilco Capital EuropePaul McGowan, CEO
▲ NORTH, SOUTH AND CENTRAL AMERICA ▲
▼ EUROPE AND THE ASIA-PACIFIC REGION▼
Hilco Merchant Resources, LLCMichael Keefe, CEO Cory Lipoff, PartnerBen Nortman, PartnerIan Fredericks, SVP, CLO
Hilco Fixture Finders Scott Hoek, CEOEd Stepp, EVP
Hilco Real Estate, LLCNeil Aaronson, CEOGreg Apter, PresidentNavin Nagrani, EVP, PartnerRobert Perez, EVP
Hilco Redevelopment PartnersJohn Chen, CEORoberto Perez, EVP
Hilco Asset Sales Canada, LLCBruce Lyle, PresidentJohn Sharpe, Managing Director
Hilco Industrial, LLCTom Greco, co-CEOSteve Wolf, co-CEO
Hilco Receivables, LLCJay Stone, CEOBuddy Beaman, COO/EVP
Hilco Streambank, LLCGabe Fried, CEODavid Peress, EVPJack Hazan, EVP
Hilco Wholesale Solutions, LLCMarc Caplan, President
Hilco IP Merchant Banking, LLCMichael Friedman, CEO
Hilco Acetec (Mexico)Ildefonso Acevedo, CEO
Hilco do BrasilThomas Felsberg, CEO
HRC AdvisoryAntony Karabus, CEOFarla Efros, PresidentRichard Lynch, EVP/Strategy
Hilco Real Estate, LLCNeil Aaronson, CEOGreg Apter, PresidentNavin Nagrani, EVP, Partner
Hilco Brands, LLCJeff Branman, Managing Director
Hilco Asset Protection, LLCMike Gilligan, VP
Hilco Global Asia-PacificSupanit Chaiyawat, CEO AsiaFrancis Yau, CEO Greater ChinaAllan Sim, EVP Asia-Pacific Region
Hilco Merchant AustraliaKevin Olson, Managing Director
Hilco Capital EuropePaul McGowan, CEO
Hilco Industrial EuropeChris Hall, CEO
Hilco Industrial AcquisitionsRobert Bouland, CEO
MONETIZATION
Jeffrey Hecktman, Chairman/CEO
John Chen, Chief Operating Officer
Gary Epstein, EVP, Chief Marketing Officer
Eric Kaup, EVP, General Counsel
VALUATION ADVISORY
Michael Keefe, President
David Zwick, Chief Financial Officer
Ben Nortman, EVP
Ed Siskin, EVP
Mark Smiley, EVP
Dan Arnold, SVP
Ryan Lawlor, VP, Asst. General Counsel
MONETIZATION
Hilco Valuation Services, LLC• Tangible and intangible asset
appraisals in real estate, inventory M&E and IP
• Business valuations• Accounts receivable• Insurance/Tax valuations• Asset verification and tagging• Compliance• Ad valorem
Hilco Enterprise Valuation, LLC • Business valuations• Intellectual property• Financial reporting• IFRS valuations• Fairness and solvency opinions• Quality of earnings
Hilco Real Estate Appraisal, LLC• Commercial, retail and industrial• Ad valorem property tax proceedings
(real and personal property)
Hilco Litigation Support• Valuation dispute resolution• Bankruptcy • Shareholder disputes• Estate/Gift tax• Expert witness
Hilco Appraisal Asia-Pacific• Online asset disposition and
redeployment services
Hilco Valuation Europe• Inventory: consumer, retail & industrial• Machinery and equipment
Hilco Valuation Australia• Retail inventory
VALUATION
▲ NORTH, SOUTH AND CENTRAL AMERICA ▲
▼ EUROPE AND THE ASIA-PACIFIC REGION▼
Hilco Merchant Resources, LLC• Retail asset-related disposition and
acquisition services• Retail M&A facilitation• Outsourced store management and
operation• Shrink reduction services• Marketing services
Hilco Fixture Finders• FF&E disposition services
Hilco Real Estate, LLC• Property/lease disposition• Principal acquisitions and sale/leasebacks• Real estate brokerage/auctions
Hilco Redevelopment Partners• Acquisition of land and property• Financing the redevelopment• Sale or lease of redevelopment• Repurposing obsolete properties• Remediation
Hilco Industrial, LLC• Acquisition and disposition of machinery,
equipment and industrial inventory
Hilco Industrial Assets (Canada)• Asset Disposition
Hilco Receivables, LLC• A/R portfolio acquisition and collection• Commercial A/R portfolios• Non-performing loans• Purchase charged off consumer debt
Hilco Streambank• Intangible asset valuation services• Market development and auctions for
domain names, trademarks, IPv4, etc.
Hilco Wholesale Solutions, LLC• Disposition services for
underperforming and excess consumer products inventory in wholesale environments
Hilco IP Merchant Banking• IP financing, monetization and capital
solutions on patents in the technology, telecommunication and healthcare industries
Hilco Acetec (Mexico)• Industrial asset and real estate
appraisals and disposition
Hilco do Brasil• Valuation, monetization and advisory
services
HRC Advisory• Strategic consulting for retailers and
consumer product companies• Performance enhancement and R.O.I.
processes• Pre-acquisition operational due diligence• Store operations and workforce
management
Hilco Real Estate, LLC• Lease portfolio restructuring
Hilco Asset Protection, LLC• Physical facility asset security and
protection services
Hilco Brands, LLC• Brand, licensing, monetization
Hilco Global Asia-Pacific• Online asset disposition and
redeployment services
Hilco Merchant Australia• Asset-related advisory and
monetization services to retailers
Hilco Capital Europe• Asset acquisition and investments
Hilco Industrial Europe• Acquisition and disposition of machinery
and equipment, etc.
Hilco Industrial Acquisitions• Acquisition and disposition of machinery,
equipment, etc.
ADVISORY
Hilco Brands UK• Brand turnaround, restructuring and
advisory
Hilco Capital Europe• Strategic consulting for retailers and consumer
product companies• Performance enhancement and R.O.I.
processes• Pre-acquisition operational due diligence• Store operations and workforce management