Deal profile | Gadens advise administrators of iconic LJ Hooker

Gadens has advised KPMG as voluntary administrators of certain entities within the iconic Australian and New Zealand real estate group LJ Hooker, with creditors voting in favour of a DOCA proposal which will see the key entities out of administration and placed into the hands of existing management.

The successful DOCA proposal was put forward with the backing of the chairman of the LJ Hooker group, L Janusz Hooker, grandson of LJ Hooker and the New York based billionaire Michael Fuchs (co-founder of influential US real estate business RFR Holdings).

The multi-disciplinary Gadens team, led by James Roland, was engaged by KPMG in June 2020 once the voluntary administrations commenced. Gadens assisted KPMG to consider numerous proposals to acquire and recapitalise the household name.

The high profile transaction ultimately approved by the creditors will see a debt reduction of up to $10 million for the nearly 95 year old business which spans Australia, New Zealand, Indonesia and PNG, with an equity commitment of $30 million to support the business moving forward. 

The voluntary administrations have involved several international players, most significantly UK based secured lender, Intermediate Capital Group (ICG), and Singapore-based bidder (and secured creditor of other entities in the LJ Hooker group), Koi Structured Credit. Local players included Anchorage Capital Partners, which also put forward a proposal to acquire and recapitalise the brand.

The Gadens team worked side-by-side with Allens Linklaters acting as advisors to ICG; Gilbert + Tobin as advisors to LJ Hooker; Ashurst as advisors to Anchorage Capital Partners and Baker & McKenzie as advisors to Koi Structured Credit. This transaction further embeds Gadens as a key advisor in restructuring and insolvency matters for Australian enterprises.

This transaction follows several other significant restructuring matters the Gadens team have worked on in recent months, including the refinancing and corporate reorganisation of Rapid Loans Group and ongoing voluntary administration of gaming operator Silver Heritage Group.

Commenting on the transaction, lead partner, James Roland said: “We are pleased to have advised KPMG in relation to this technically challenging and complex restructuring. This has been an enormously rewarding engagement for our team on several fronts. That said, the real enjoyment (and satisfaction) on this matter has been the opportunity to work as a team with KPMG to deliver this result.”

Gadens CEO, Mark Pistilli adds: “This is exactly the kind of high profile and complex matter where Gadens is playing an active part in this market, and I am really pleased to see us at the table alongside leading firms like G+T, Allens, Ashurst and Bakers. The leading roles we have recently played in the Rapid Loans Group and Silver Heritage Group matters, and now on LJ Hooker, show that we belong at that table with Australia’s leading restructuring and insolvency advisers. James and Clem are market leaders, and they can bring along our deep expertise in corporate, property, banking, disputes and other areas to support the most complex restructurings across the country and the region.”

Practice groups involved: Restructuring and Insolvency, Corporate Advisory, Banking and Finance.

Key team members: The transaction was led by partner James Roland who worked with senior associate Clementine Woodhouse (Restructuring and Insolvency), and partners including Elliot Raleigh (Banking and Finance), Jeremy Smith, Robert Tracy, Hazel McDwyer and Brett Feltham (Corporate Advisory), and special counsel Breanna Davies (Corporate Advisory) rounded off the multi-disciplinary team that worked on the matter.