The Client
The court appointed a Chief Restructuring Officer in the fraud and store abandonment case leading to the bank’s subsequent seizure and closure of Boston based Alpha Omega, a seven-store chain known worldwide for their expansive inventory of  fine Swiss watches. The Chief Restructuring Officer was charged with preserving and collecting jewelry, fixed assets, and intellectual properties from the debtor, Alpha Omega, converting it into cash, and accounting for all the company’s properties and proceeds from the liquidation process.

The Gordon Company Assignment
Enable the Chief Restructuring Officer to:

• Secure fine jewelry and  watch inventory valued at about $40 million
• Dispose of the debtors inventory, while maximizing the residual value to creditors
• Minimize the cost of monetizing the inventory
• Monitor and control the liquidation process, providing an auditable record of sales transactions, proceeds from the sale, and remaining inventory
• Minimize the negative publicity of the alleged fraud, store abandonment, and store closure by the bank in order to maximize Alpha Omega sales during the remainder of the Christmas season

The scope of The Gordon Company’s assignment included:

• Developing an urgent asset management and liquidation plan satisfactory to the Chief Restructuring Officer, the primary creditor, the bank, and as necessary law enforcement authorities
• Immediately reopening and re-staffing seven Alpha Omega and Alpha Omega Express  stores in the Cambridge and Boston, MA area
• Reestablishing home office administrative functions such as, personnel management, loss prevention, marketing and advertising, real estate and lease management, and customer service departments
• Securing debtor’s fine watches and jewelry, customer property, and vendor consignment assets valued at about $40 million
• Developing and implementing a timely sales, expense, media, and staffing plans to continue business through the Christmas season and, if necessary, the subsequent liquidation of all remaining inventory
• Implementing and auditing local sales, pricing, and inventory control processes to the satisfaction of the Chief Restructuring Officer, creditor representatives, and law enforcement officials

Considerations

• Fine Swiss watches represented in excess of 50% of the inventory
• Alpha Omega owners had allegedly stolen about six million dollars in inventory and fled the country
• The Alpha Omega stores had been immediately closed by the primary creditor, the bank, and was deemed a crime scene by the FBI and local law enforcement authorities
• Store managers and sales staff had been terminated
• The Home Office was closed and administrative employees had been terminated
• Inventory information, as well as sales and inventory records had been seized by authorities as evidence, limiting the availability of timely information to manage subsequent marketing and sales activities
• Time was of the essence

 
The Gordon Company Solution and Accomplishments