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CLINTONSPROFILE Ball is in independents’ court


Waking up to discover American Greetings had forced Clinton Cards in to administration overnight sent shock waves through the card industry, Tracey Bearton looks at the latest developments and fallout from the US firm’s June takeover of half the estate.


the ball is now in the independent card retailers’ court.


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After 43 extra stores were closed on June 8, that leaves 287 established greetings card shops in prime retail sites going begging, so there could be an opportunity for some of the braver independents to broker a deal with administrators Zolfo Cooper for individual stores. Since American Greetings forced Clintons into administration last month, rumours have abounded the giant US supplier would move into the retail side by taking over the British company. On Thursday, June 7, that industry gossip turned into reality when the Ohio-based company took control of 377 Clintons and 20 Birthdays stores, preserving around 4,500 jobs – although it is not known if they will keep the company name or whether any further job losses will follow. Zolfo Cooper announced the sale of the brands and assets of the group to Lakeshore Lending Ltd, a subsidiary of American Greetings, with the package of stores having contributing around £212milliion in annual revenues out of the group total of £360m. American Greetings bought the £35m senior secured debt from the banks on May 9 in the move which precipitated the administration crisis, and is believed to have bid around £24m of that debt in an auction of the assets that constituted a viable business. The outstanding portion of the debt may be paid from the remaining Clinton liquidation though the process, expected to take up to a


Clinton Cards stores acquired by Lakeshore Lending Ltd, a subsidiary of American Greetings Corp: Aberdeen, Trinity Ctr; Aberdeen, U27 Bon Accord; Aberdeen, U34 Bon Accord; Abergavenny; Aberystwyth, Gt Darkgate St; Aldershot; Alton; Altrincham, George St; Andover, 48a High St; Ashbourne; Ashby de la Zouch; Ashford; Aylesbury, U2/3 Friars St; Ayr, High St; Banbury, Castle Quay; Barkingside; Barnsley, Queen St; Barnstaple, High St; Barrow, Portland Wk; Basildon, Eastgate Ctr; Basingstoke, Festival Place; Bath, Stall St; Beaumont Leys; Beckenham; Bedford, Silver St; Belfast, Forestside; Berkhamsted; Beverly;


s the dust begins to settle on American Greetings’ takeover of around half the Clinton Cards estate,


John Ryan’s verdict


“In essence, Clinton Cards looked like a little slice of death from yesteryear when it came to display. “They had fl at wall presentation which is old-fashioned and cheap and, in a lot of their older branches because they didn’t modernise the estate very much even the carpet looked threadbare with bits of gaffer tape over it in places holding it together – I kid you not. “Older stores were a horrible tangerine colour but pastel and in the


new stores which they revamped starting around the time of the Royal Wedding last year, with St Albans the fi rst one, they were a fairly lurid Easyjet orange which may work for a budget airline but doesn’t work when you’re trying to sell cards at a higher price than the competition.


“In short, it was an estate that was unloved, new or old.” John Ryan, Greetings Today columnist and Retail Week Stores Editor


year, may not cover the whole amount. Having already closed 26 Birthdays and 30 Clintons, with up to 300 shop workers and 66 head offi ce staff losing their jobs by the end of May, the deal left Zolfo Cooper to sort out the remaining 330 stores. Their fi rst move came just 36 hours later with the announcement that 27 Clintons and 16 Birthdays were to close immediately. The fate of the rest is still to be decided and this is where the independents could move in as Joint Administrator Peter Saville said: “The Joint Administrators continue to welcome expressions of interest for this part of the estate, as a whole or in part.” The sale is a move away from the original plan announced after American Greetings snapped up Clinton’s £35m debt from its original lenders, Barclays and RBS, early on May 9. Also owed around £15million in unsecured exposure, the US owner of UK Greetings, the holding company for


Bexhill; Bexleyheath, Broadway; Bicester; Billericay; Birkenhead, The Pyramids; Birmingham, Bullring; Birmingham, The Fort; Bishop Auckland Newgate St; Bishops Stortford; Blackburn; Blackpool, Houdshill Ctr; Blackwood, High St; Bluewater 1; Bluewater; Blyth, Keel Row Ctr; Bognor; Bolton, Market St; Bourne; Bournemouth, Castlepoint; Bournemouth, Christchurch Rd; Bracknell, Charles Square; Bradford, Five Lane Ends; Braintree, George Yard; Brecon, High St; Brent Cross; Brentwood, 47c High St; Bridgnorth, High St; Bridgnorth, Fore St; Brighton; Bristol, 20 Broadmead; Bristol, Cribbs; Bristol, Longwell Green; Bromley, 70 The Glades; Bromsgrove, 88 High St;


14 www.greetingstoday.co.uk


Burgess Hill; Burnley, The Mall; Burton, Swan Walk; Bury St Edmunds; Bury, U14 The Haymarket; Buxton; Camberley, Grace Reynolds; Cambridge, Grafton Ctr; Cambridge, Grand Arcade; Canary Wharf; Canterbury, Gravel Walk; Cardiff; Carlisle, English St; Carmarthen, Red St; Caterham; Cheadle, High St; Cheapside; Chelmsford, High St; Cheltenham, High St; Chesham, High St; Chester, Newgate Row; Chesterfi eld, High St; Chesterfi eld, Vicar Lane; Chichester, 14 East St; Chingford North, Station Rd; Chingford, Old Church Rd; Chippenham, Emery Gate; Chorley, Market Walk; Clacton, 27, Pier Av; Clapham; Cleethorpes; Coalville; Colchester, Culver Walk; Congleton, High


their interests in Britain, immediately called in the debt and Clintons - went into administration.


Zolfo Cooper had said they would cut the chain from 783 stores to around 400, losing the whole 133-store Birthdays chain in the process but the deal means 20 have been saved. Mr Saville added: “We have always been of the view that, despite an intensely-competitive retail environment and what proved to be excessively-ambitious expansion plans in recent years, there was a strong underlying business contained within Clinton Cards. “The signifi cant number of credible expressions of interest we received for the business we have sold today, from both trade and fi nancial buyers alike, is testament to this fact. “We would like to thank the staff for their dedication and patience throughout what has been an understandably diffi cult time for all


St; Consett; Cosham, High St; Cotteridge; Coventry, Market Way; Coventry, The Mall; Coventry, Upper Precinct; Craigavon, Rushmere Ctr; Crawley, 43 County Mall; Crewe, Market Ctr; Croydon. 1024 Whitgift Ctr; Cwmbran, The Mall; Darlington, Cornmill Ctr; Daventry; Derby; Devizes; Doncaster; Dorchester; Dorking, St Martin’s Walk; Douglas IOM; Dover; Dronfi eld; Dudley, L66 Merryhill; Dudley L92 Merryhill; Dundee, Overgate Ctr; Dunfermline, Kingsgate Ctr; Dunstable; Durham, Silver St; East Grinstead; Eastbourne, Arndale Ctr Eastbourne, Terminus Rd; Eastleigh, Swan Ctr; Edinburgh, Ocean Terminal; Edinburgh, St James Ctr; Eltham; Ely, High St;


concerned and we wish both them and the new owners of the business every success for the future.


“Having concluded the sale of the core Clinton Cards business, the Joint Administrators will now focus their efforts on the store portfolio identifi ed as part of the closure programme announced on May 16, 2012.” However, any potential buyers would have to move quickly as it is anticipated the assets will be liquidated and the proceeds used to pay creditors, including American Greetings which was Clinton’s biggest supplier. American Greetings Chief Executive Zev Weiss said: “We are pleased to welcome these stores, the Clinton Cards brand, and the approximately 4,500 employees as members of the American Greetings family. We believe that properly managed, and with the appropriate capital structure, Clinton Cards can be both an important and profi table retailer in the speciality channel of distribution over the long term. “The separation of the acquired assets and business from the legal entity in administration is an important fi rst step of this process. “We have also lined-up a leadership team to run the new UK subsidiary that has extensive specialty retail channel experience.”


American Greetings generates annual revenues of £1.1bn from brands including Carlton Cards, Gibson and Papyrus. Its UK operations began in the early 1980s with the purchase of Rust Craft, Celebration Arts Group and Andrew Valentine which merged to form Carlton Cards. After more acquisitions in the 1990s the business took the UK Greetings name.


Enfi eld; Enniskillen, Erneside Ctr; Epping, High St; Epsom,, Ahley Ctr; Exeter, High St; Farnborough, Princes Mead; Farnham; Felixstowe; Fleet; Folkestone, Sandgate Ctr; Fosse Park; Gateshead, Metro Ctr; Glasgow, Buchanan Gall Glasgow, Silverburn; Glasgow, St Enochs; Glasgow, The Fort; Gloucester; Grantham, High St; Gravesend, St George’s Ctr; Grimsby, Freshney Place; Guildford, Friary Ctr; Halifax, Halstead, High St; Hamilton, Regent St; Hammersmith; Hanley, Parliament Row; Hanley, The Potteries; Harbourne, High St; Harlow, Harvey Ctr; Harrogate; Harrow, St Ann’s Rd; Hartlepool, South Mall; Hastings; Havant; Haverhill


Hayward’s Heath, South Rd; Hemel Hempstead, Marlowes; Hereford, High St; Hexham, Fore St; High Wycombe, Eden; Hinckley, Castle, St; Hitchin; Hoddesdon; Hornchurch; Horsham, Swan Walk; Hove; Huddersfi eld, Kingsgate Crt; Huddersfi eld, New St; Hull, Prospect Ctr; Hull, St Stephen’s Ctr; Huntingdon; Ilkley; Keighley; Kendal; Kettering, The Mall; Kidderminster, Weavers Wharf; Kilmarnock; Kings Lynn, High St; Kingston, Betnall Ctr; Kingston, Eden Walk; Lanark, Lanimer Ctr; Lancaster; Leamington, Royal Priors Ctr; Leatherhead; Leeds, St Johns Ctr; Leeds, U4 White Rose; Leicester, U16/17 The Shires; Lime St; Lincoln, High St; Liverpool, St John’s Ctr; Liverpool,


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