Ashurst’s second Cerburus deal saves Torex cash

Ashurst client Cerberus’s acquisition of troubled software retailer Torex has meant the company’s administrating banks have been able to recover most of their money.

Advised by Allen & Overy (A&O), the Royal Bank of Scotland (RBS) recovered the majority of the £202m it leant to Torex when the heavily indebted software company went into administration following a continuing probe by the Serious Fraud Office (SFO).

The deal sees Cerberus buy the company’s assets for £204m, but not the holding company.

The sale was part of the pre-pack administration – when a third party agrees with the administrator to buy the insolvent company’s assets to reduce the costs of a normal administration – arranged by RBS. It also cuts down on negative publicity.

A&O banking partner Trevor Borthwick, who led on the deal, said: “Pre-pack administration is still a relatively new concept, but in this case it’s helped bring about the best possible solution for Torex, providing a basis from which the business can continue to focus on the needs of its clients.”

Linklaters advised Torex both on the probe and on the Cerberus deal. Schulte Roth & Zabel also advised Cerberus as US counsel.

This was the second deal for Cerberus that Ashurst has closed this week. Corporate partner Giles Boothman manages the relationship. The top 10 firm also advised its marquee hedge fund client on its acquisition of the Focus DIY retail business from Clifford Chance clients Duke Street Capital, Apax and Focus chairman Bill Archer for £250m.