Wingate Group's Capital Solutions team has completed another high-profile transaction.

Wingate and global investment bank, Nomura jointly led the consensual balance sheet restructure of Godfreys, Australia’s biggest vacuum and cleaning retailer.  The restructure resulted in a significant reduction of the direct debt obligations from over A$210 million to A$20 million. Godfreys’ residual obligations have been converted into a mixture of shareholder loans or equity in a “loan to own” process.

“The significant reduction of debt levels will assist management and the new owners to refocus the business and materially enhance profitability,” said Tom Krulis, the newly appointed CEO of the restructured group and a veteran of the vacuum cleaning industry.  Tom added, “The future prospects of Godfreys, through its many successful company-owned and franchised stores, are very positive and we believe the former entrepreneurial approach, which saw it thrive for many years, can be restored”.

Franco Dogliotti, Head of Advisory at Wingate Group who led the transaction said, “Godfreys is a great example of a highly successful specialty retailer which will benefit greatly from a de-levered balance sheet, new ownership and management”.

The transaction took over a year to develop and complete and involved working closely with all the stakeholders of Godfreys to achieve the restructure.  “The innovative approach by Wingate and Nomura were instrumental in facilitating the transaction,” said Tom Krulis.

Richard Blumberg, Managing Director – Capital Solutions at Wingate Group, said “This transaction demonstrates how the secondary market for buying debt in Australia has become an option for hedge funds and other financiers interested in acquiring control of a business.  There have been very few examples of these deals successfully concluded in Australia, which positions our team at the leading edge of this exciting new area”.

The Wingate deal team for this transaction included Franco Dogliotti, Richard Blumberg and Paul Nagy.