SSG Capital Advisors acted as the investment banker to an affiliate of Stapleton Group, the assignee for the benefit of creditors of Starcrest Products of California in the sale of select assets to Silver Star Brands. The transaction closed in September 2022.
Founded in 1971, Starcrest is a multi-channel, direct-to-consumer retailer based in Perris, CA. Through its six catalogs, seven ecommerce channels and an onshore call center, the company offers a broad selection of products at affordable prices. Starcrest’s representative product categories include home and office, kitchen and cleaning, clothing and accessories, health and beauty, gifts and décor, toys and games, tools and auto and seasonal gifts.
Starcrest had established strong vendor relationships and significant customer loyalty over its more than 50 year history, however, the business experienced steady declines in revenue and profitability in recent years. The financial deterioration was the result of industry headwinds, including a rise in postage and paper costs, an increase in competition from other ecommerce retailers, a reduced number of suppliers and an increase in labor costs.
In order to effectuate a sale of its assets, Starcrest entered into an assignment for the benefit of creditors agreement with the assignee in June 2022. The assignee subsequently retained SSG as its investment banker to conduct a comprehensive sale process and solicit interest from strategic and financial buyers. The process attracted significant interest from multiple parties and resulted in several strategic alternatives. Ultimately, the offer from Silver Star Brands proved to be the highest and best value for the assets and provided for a quick closing which was critical to maintaining engagement with Starcrest’s customer base. SSG’s special situations expertise, experience in the direct-to-consumer industry and ability to market and close transactions in an expedited timeframe resulted in a competitive environment that maximized asset value for the creditors and allowed the legacy of the catalog brands to move forward under a new operator.