Hilco Global
Hilco Global is an American financial services holding company. It operates over twenty businesses and specializes in valuation, advisory, monetization, and liquidation. Headquartered in Northbrook, Illinois, it has offices throughout the world and provides services to companies, their lenders and professional services advisers across a broad spectrum of business categories including retail, industrial and financial. Hilco delivers services focused on maximizing the value of under-performing and excess retail, consumer products and industrial inventory, real estate, intellectual property, including consumer brands, and accounts receivable. Hilco is also considered one of the largest distressed investment and advisory companies in the world.
History
Hilco Global was founded in 1987 by Jeff Hecktman. Originally operating under the name Hilco Trading, the holding company was renamed in 2013, eliminating the use of the name Hilco Trading Company as well as introducing a new logo and website for the company. Hecktman founded Hilco Trading Company after restructuring his family's industrial supply firm and selling off many of the business' under performing assets.In 2000, Hilco Global founded a business division named Hilco Merchant Resources LLC, a subsidiary of the company that specializes in retail inventory valuation, retail store closings, retail inventory disposition and asset protection. Michael Keefe, formerly of Gordon Brothers, joined HMR as the CEO the same year. In 2001, the division became known as one of the top five liquidation firms in the United States, having been involved in the $1.8 billion liquidation of Montgomery Ward following that company's bankruptcy. Some of its most notable disposition and liquidation deals included work for Sears, CompUSA, Sportmart, PharMor Rx, and Coldwater Creek. In 2016, the division helped save Aéropostale from final liquidation, eventually allowing the retailer to restructure and reopen over 500 stores. Hilco Merchant Resources also expanded its operations by opening an office in Australia, taking on liquidations of stores that include Fletcher Jones, Dubbo Everyday Living and Dick Smith.
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Hilco Global founded its real estate business division in 2000 with the formation of Hilco Real Estate, LLC, to be a national provider of accelerated real estate disposition and advisory services. It has acted as agent or principal for numerous real estate acquisitions and sales. It was co-founded by Mitchell Kahn who served as the company's CEO until 2008. Kahn was replaced by Neil Aaronson as CEO and Gregory Apter was promoted to President of the company. Hilco Real Estate was responsible for numerous large transactions in real estate including 1,200 leases for MCI Worldcom that the company either sold or renegotiated. It also closed hundreds of Blockbuster stores following the company's 2010 bankruptcy as well as approximately 200 Borders Book Stores following that company's 2011 bankruptcy. Hilco Real Estate was also involved with the selling of over 165 unused properties owned by Hostess after that company filed for bankruptcy in 2013.
Hilco Global launched Hilco Capital in 2000 as a partnership with Paul McGowan, who serves as the company's CEO. Based in the United Kingdom, Hilco Capital is involved in retail restructuring and distressed investments. It has expanded internationally with the opening of offices in Ireland, Spain, Germany, Canada, and Australia. Part of its operation includes investing in stressed and defunct companies, most notably is HMV, a music and entertainment retailer associated with the trademark His Master's Voice. After filing for administration, the company has recorded millions in sales and competes against Amazon as one of the leading music and entertainment retailers in the U.K.
In 2001 Hilco Global formed a business unit called Hilco Appraisal Services LLC, bundling all of the industrial, retail and real estate appraisal services of the holding company into a single unit. Later renamed Hilco Valuation Services, the company is based in the U.S. and has global offices in the U.K., Canada, Australia, Mexico, South American and Asia. One of this units most notable deals was completed in 2005 with the valuation of 29 locations of over 40 million square feet owned by Delphi Automotive.
2001 was also the year Hilco Global expanded its holdings with the formation of Hilco Receivables LLC, a division that purchases bad debt and services accounts receivable. By 2004, Hilco Receivables had acquired more than $2 billion in receivables and in 2006 it opened a 200-person collection center that operated under the name Apex Financial, LLC. The company also provides receivable appraisals to lenders as well as financing to companies who acquire receivables portfolios. One of the most notable transactions involving Hilco Receivables was the purchase of $25 million in account receivables from National Envelope Corporation after its bankruptcy in 2013.
In 2004, Hilco Global acquired a retail strategic consulting practice from Arthur Andersen called Senn Delaney – SD Consulting. Hilco Global has operated SD Consulting for the last 10 years with 35 independent consultants. In 2013, Antony Karabus was hired as President and CEO of SD Consulting. Later that year the consulting practice was rebranded as Hilco Retail Consulting or HRC Advisory.
Hilco Global began drawing attention from major investors in 2006 when it was announced that Goldman Sachs Group and Cerberus Capital Management were in talks to purchase a significant stake in the company. Hecktman sold part of the company to both investment companies to help finance other ventures, including private equity style buyouts of faded consumer brands. Hilco Brands was formed from the initial investment as an extension of Hilco Consumer Capital, another company held by Hilco Global. One of the first brands purchased was Halston, a notable fashion line that became popular in the 1970s. Additional brands purchased by Hilco include the Ram and Tommy Armour golf club lines, both companies that were previously based in Chicago, as well as Polaroid and Linens 'n Things.
Hilco Streambank is an additional subsidiary added to the Hilco Global family in 2011. The company was formed to provide services for intellectual property brands such as Borders, Posh, Tots, Linens N’ Things and Circuit City. Hilco Streambank is also known for its used for the purchase and sale of IPv4 assets.
Hilco Global expanded its real estate business in 2012 with the formation of Hilco Real Estate Finance LLC, a lending division of Hilco Real Estate. Hilco Real Estate Finance operated as a private real estate mortgage lending company and in a year and a half had originated loans in approximately 20 states. Hilco Global sold Hilco Real Estate Finance in 2014 to the private equity firm Garrison Investment Group. The cost of the deal was undisclosed with the overall value of the purchase adding to Garrison's already $3.5 billion in assets. After the sale, the company was rebranded as Jordan Capital Finance.
Hilco Global's Industrial unit, Hilco Industrial LLC, made national news in 2014 with its involvement in the disposition of excess municipal transportation assets for the City of Detroit following the city's bankruptcy, the largest municipal bankruptcy filing in the history of the United States. Prior to its involvement with the City of Detroit, Hilco Industrial played a role in the sale of Chrysler and GM plants in 2010 as well as Hilco Global's acquisition of the Sparrows Point Steel Mill.