Ihr Platz GmbH
In 2004, German drugstore chain Ihr Platz GmbH was struggling amid declining sales, mounting losses and ineffectual management. With a retail network of 689 company-owned stores, 150 franchisee-owned stores, two distribution centers and more than 8,800 employees, Ihr Platz was on the brink of insolvency and subsequent liquidation. In an effort to rescue the company, Deutsche Bank, Goldman Sachs and Sagamore Hill purchased Ihr Platz's $144 million in bank debt from its original lenders and A&M was engaged by the Company to develop a restructuring plan. In March 2005, Goldman Sachs bought out the interests of its partners and Alvarez & Marsal took over the management of the Company as Chief Executive Officer and Chief Financial Officer to implement a comprehensive operational turnaround plan. The A&M team implemented a restructuring concept that employed the use of a German insolvency law that had been modified in 1999, but had never been used. The self-administered insolvency allowed Ihr Platz to work out its debt, rather than liquidate. A&M also identified and closed loss-making operations, streamlined inefficient processes, and devised methods to increase sales. The turnaround, which is still in progress under the Chapter 11-style "in-court" restructuring process, is the first of its kind in Germany.
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