Mackays Stores Limited traded in excess of 260 high street fashion stores, trading as M&Co with stores in many market towns across the UK, complimented by an online presence.
The business had battled with the decline in high street retail seen by many retailers but due to a combination of high rents and the onset of COVID-19, the trading business experienced acute cash flow difficulties and was faced with administration.
The trading company was a subsidiary of a family owned group who were keen to maintain jobs, ensure ongoing trade and avoid the crystallisation of property-backed guarantees.
BDO was approached to advise the newly set up buying subsidiary on buying a business out of administration. The role then expanded into that of buy-side advisor in fund raising, deal negotiation and pensions scheme rescue.
The objective was to ensure the purchase of the trade and assets of the appropriate stores while protecting the pension scheme and property assets.
The purchaser achieved all objectives, minimising the acquisition cost where possible and attracting the necessary investment. A scheme rescue was put in place so all members have the potential for full future benefits. 2,300 jobs were saved and the family remain in control of the Group’s freehold properties.