On the left is Darren Jones, left, who chairs the Business, Energy and Industrial Strategy committee, and Stephen Timms, right, chairman of the Work and Pensions committee and on the right is Rob Templeman the former CEO of Debenhams and Jonathan Feuer , a managing partner at CVC
There’s been a trend in recent months of asset strippers taking over big retailers and gutting them to line their own pockets and leaving a mess as they disappear.
The latest example is that of Debenhams which was seemingly deliberately run down by the likes of Jonathan Feuer of a private equity consortium of CVC, Merrill Lynch and Texas Pacific Group, which owned the firm for three years between 2003 and 2006. He paid himself £50m while in post – more than the current deficit for the pension fund which has a massive black hole meaning pensioners will 10% less than they would expect. And then there was the former CEO of Debenhams Rob Templeton who paid himself a million pounds a year from 2003 to 2011 when the company was struggling and many shop workers were on minimum wage.
“The landmark stores were part of our high streets,” said Ian Carrotte, “and should have remained as gold mines for the owners. Instead, they allowed them to become outdated and run down while shafting them financially. Now there are 19,000 shop workers out of work, suppliers owned millions and our high streets much poorer as a result. I hope the parliamentarians haul them over the coals.”
Darren Jones, chairman of the business, energy and industrial strategy committee, and Stephen Timms, who chairs the work and pensions committee will lead the questioning of the multi-million pound former executives of the department stores after having previously criticised their handling of one of the UK’s most famous shops.
BooHoo bought the name and online aspects of the business when it finally closed in May.
Writing for the Daily Mail’s This Is Money Richard Marsden reported: “But, in 2007, the Financial Times estimated he and two other directors made personal profits of £103million from when the company was refloated in 2006, with Templeman netting £41million. Meanwhile, TPG Capital’s one-time European boss Philippe Costeletos, 56, said to have been the ‘mastermind’ of the Debenhams takeover – is also thought to have enjoyed multi-million-pound bonuses. During that period, the firm was loaded with more than £1billion debt, £1.2billion was extracted in dividends – almost double the profits made over the period – while store freeholds were sold and leased back, on expensive, upwards-only rental contracts, to raise £495million. Dozens more branches were opened, adding dramatically to the company’s rent bills which rose 55 per cent in the next ten years.”
Below is a list of firms that have recently got into financial trouble:
CONSTRUCTION, PROPERTY AND ALLIED INDUSTRIES
Administrators Appointed
Preston Paving (UK) Limited 06339407
UKL Projects Limited 05556420
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Castle Construction Building Limited 06830720
Masters Building Solutions Limited 10329327
Orange Civil Engineering Limited 11201582
Supreme Building Developments Limited 11185470
The Only Way is Kirk Limited 07563845
Liquidators Appointed
1st Solutions Infrastructure Contractors Limited 10766161
Bramber Construction Co Limited 01354167
Brian Hall Limited 08651094
Conform Concrete & Formwork Specialists Limited 04668122
Construction & Fit Out Solutions Ltd 10319223
Costhorpe Building Products Limited 03031707
Dents Fabrication Limited 10522881
Ethical Construction Limited 12486802
GFL Construction Limited 08864377
Luca Construction limited 10724706
M J P Joinery Services Limited 09784108
Northwood D&B Vision Limited 12108828
P and P Groundworks Limited 07480887
Platinum Home Refurbishments Limited 12308899
SB 82 LTD 12337959
TRW Northwest Limited 10410879
URBN Construction Limited 09689767
Walker Electrical Projects Limited 11246243
YSG Group Limited 11569405
Members Voluntary Liquidations
Advanced Cooling Solutions Limited 04758183
Hopkinson Plant Hire and Construction Limited 03749126
Plant Home Limited 05715808
RMP Homes Limited 03345434
The Building Renaissance Company Limited 03624100
White Rose Developments Limited 01968037
Petitions to Wind Up
Orchard Brickwork Limited 08562134
Winding up orders
Chic Building Limited 11305153
Ellis Walls and Ceilings Limited 07174441
Home Counties Interiors Limited 12051053
Purple Development Homes Limited 11621690
SPD Group NW Limited 09907101
FOOD AND DRINK MAKERS
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Jake’s Vegan Steaks Limited 10776376
Masterchef Luton Limited 08847894
Maya Foods Limited 11310486
VF Foods (UK) Limited 09202578
Wingtip Brewing Company Limited 09427769
Liquidators Appointed
Goa Spice (Mexborough) Limited 11849430
China Village 118 Limited 11942276
Mrs Canopy Limited 12226365
The Field Kitchen (UK) Limited 07457911
The Tasted of China (Yorkshire) Limited 09947852
Wingtip Brewing Company Limited 09427769
Yokkmokk Limited 11248055
Members Voluntary Liquidations
John W F Hughes & Co Limited 00826647
R Jackson (Potatoes) Limited 00141592
Selby Salads Limited 04204258
Winding up orders
The Meat Company (Sussex) Limited 11974869
HOSPITALITY, TRAVEL, EVENTS AND ALLIED INDUSTRIES
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Boutique Restaurant Group Limited 10874825
Downtown Food And Drink Limited 11496874
The Coliseum (London) Limited 11160730
Liquidators Appointed
A Nineteen Company Limited 11448516
Bar Opus Limited 08460427
Bay of Bengal Limited 11057624
Holdsworth Designs Limited 04850315
Horns Mill Limited 11855661
Inception Global Limited 08154233
Lodge Events Limited 11996880
Lounge India Lowestoft Limited 11352853
Manor House Spa Limited 09691932
Sea View Hotel Swansea Limited 11467614
Opus Restaurant Limited 05244581
Scorpion Event Production Limited 03879627
Shakes & Steaks Company Limited 11963742
Shepherd Cox Hotels (Manchester North) Limited 10604330
Studio Bea Limited 11518330
The Rose & crown (Hoylandswaine) Limited 11438999
Members Voluntary Liquidations
A-I-R Hotels Limited 01148159
Hellene Travel Limited 03644980
Studytrips Limited 02611466
Studytrips Travel Limited 03336697
Tourico Holidays UK Limited 07194495
UEI Restaurants Limited 07325381
LOGISTICS AND ALLIED INDUSTRIES
Administrators Appointed
Trans 2 Logistics Limited 09621600
Venian Warehousing And Distribution Limited 10439127
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Airline Taxis Limited 07884904
Dutch Logistics Limited 09443819
Fuel Specialist Cars Limited 10445328
JB Rail Solutions (Doncaster) Limited 09943848
JCM Transport Nantwich Limited 06623138
MW truck Assist Limited 10215056
Nosa Ajanaku Ajanaku Driver Services Limited 09528273
Liquidators Appointed
Annett Road Garage Limited 12235726
Bristol Freight Limited 11221639
DG Transport (Manchester) Limited 10145280
Easy Taxis (NW) Limited 12000235
Fast Despatch Logistics (Croydon) Limited 11612891
Fast Despatch Logistics (Dartford) Limited 11610277
Freight Fulfilment Limited 09789069
Hall’s of West Moors Limited 11512093
Hope Commercials Limited 04328571
IB&Co Services Limited 10146265
J A Plant Hire Limited 10512334
Johnston Rigging and Lifting Limited 09023277
LRP Transport Limited 11114389
Lutterworth Transport & Trailer Services Limited 06616698
MW Truck Care (Kent) Limited 12600098
MW Truck Care Limited 12280566
New Rodley Motors Ltd 07918673
Red Century Logistics Limited 07857556
Rhys Davies Freight Logistics Limited 01692338
Members Voluntary Liquidations
J.D. Birch & Son Limited 01194548
Autoteq Limited 01434750
Hobby Caravans (UK) Limited 01741984
Road Rail Services Limited 09160705
Stobart Rail Freight Limited 05961679
Stobart Transport & Distribution Limited 05907280
MANUFACTURING
Administrators Appointed
Form Manufacturing Limited 09462616
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
A S Fashion (Leicester) Limited 10026384
Innocence Clothing Limited 04184514
Sigmetech Limited 12012729
Liquidators Appointed
Ancestors of Dover Limited 02742815
Coleford Energy Limited 08163696
Forever Textiles Limited 10975106
Harton Services Limited 03371021
Hand Tools Sheffield Limited 07461075
HP Engineering & Fabrications Limited 10440455
Osprey Solar Limited 08215492
Strategic Reserve Power Limited 09160218
Williams Service Suppliers Limited 12177262
Yolo Attire Limited 11217901
Members Voluntary Liquidations
Brook Wind One Limited 10138767
Brook Wind Two Limited 10198534
Stark Solar Limited 10259098
Streetwise Fabrications Limited 06652243
Winding up orders
Oakhurst Engineers North West Limited 11354777
PRINTING AND ALLIED INDUSTRIES
Administrators Meetings Para 51
Monument Paper Bag Company Limited (The) 00481099
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Premium Brand Management Limited 07252881
Ipex Communications Limited 12109835
Liquidators Appointed
Clarendon Press Gloucestershire Limited 05144567
Crawford Shopfitters Limited 11217755
Devon Paper Bedding Limited 08858005
Doublesix Digital Publishing Limited 06429398
Kedoku Limited 09945999
Samantha Maria Limited 09226756
SK Publications Limited 034988366
Reevo Media LIMITED 11378857
RPW Design Limited 09073948
The Branding Team Limited 06594483
The Office Product Network Limited 06904772
The Shopfittings Store London Limited 11211206
TLS Marketing Limited 12341983
Members Voluntary Liquidations
Buzzword Media Limited 09072793
CJ Design Consultancy Limited 08351069
DQH Design Limited 08242731
Expression Marketing Limited 08141812
Griffin Design Consultancy Limited 07600568
Larkmoor Advisory Limited 11390206
Smudge Media Limited 10251647
Tech & Media Group Limited 10414860
Petitions to Wind Up
Aequitas Packing (UK) Limited 08913537
SGK Interiors Limited 09450679
RETAIL, WHOLESALE AND ALLIED INDUSTRIES
Administrators Appointed
Clement Browne Limited 07184480
Compulsory Liquidators Appointed s 136
Your Car Solutions Limited 10398386
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Akal Nation Limited 10864888
Clapham Wine Company Limited 08074846
Easylinks Trading Limited 03158627
Queen B Cosmetics Limited 11548852
Red Salons Limited 07946145
Romford Balti Limited 11574753
VF Foods (UK) Limited 09202578
Liquidators Appointed
Amcam Limited 08298525
Bluestar Foods Limited 12435655
Compass Music Ipswich Limited 04648229
Cotswold Creative Living Limited 09055064
Cocoa Cashmere Limited 07063801
Goa Spice (Mexborough) Limited 11849430
Interstate Design Ltd 08999203
Jolly Colliers 122 Heanor Limited 12315226
Marston Road Store Limited 09614947
NU U Salon (Hair and Beauty) Limited 09480727
SA Food Stores Limited 10976928
Shoe Embassy London Limited 10448917
Members Voluntary Liquidations
Cary Trading Limited 11223836
Petitions to Wind Up
Cherhil Limited 10836497
Winding up orders
Golf Depot Limited 02995248
VARIOUS INDUSTRIES
Administrators Appointed
Sumatra Copper & Gold PLC 05777015
Administrators Meetings Para 51
Essex County Laundry, Limited 00140030
Compulsory Liquidators Appointed s 136
Lordrite Wooden Floors Limited 06599600
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Brickcroft Social Club 2018 Limited 11604024
Fenwick School UK Limited 12439249
Keating Sports Horses Limited 11773475
The Elite Education Group Limited 12122167
Sterling Aesthetics Limited 08416715
Liquidators Appointed
Accident Reporting Services Limited 06389070
Aintree MMA Limited 10392131
Cool Kids Out of School Limited 06130632
DAG Fishing Limited 11965099
DMT Collections Limited 10420287
Evergreen Education Limited 11363383
Members Voluntary Liquidations
Atkinson Tractors Limited 00880460
Danbury Motor Caravans Limited 04385764
Guy Mascolo Charity 07729927
Mayfair Healthcare (Durham) Limited 06428250
Westminster Local Education Partnership Limited 06458328
Winding up orders
ZRT (Bolton) Limited 09320788
Types of Insolvency
Administration
Administration applies to limited companies and partnerships and is intended to get the company out of trouble and trading again if possible. Administrators can be appointed to a company that is unable, or is likely to become unable, to pay its debts. They can be appointed by the courts (on application from a creditor, directors or partners), the holder of a qualifying floating charge over the assets of the business, or the company or its directors. An administrator’s primary goal is to rescue the company as a going concern. If this isn’t possible, the administrator will try to get a better result for the creditors than would be possible if the company was wound up. If neither of these is possible, the administrator will sell the company’s property to make at least a partial payment to one or more secured or preferential creditors, such as employees or the bank.
Administrators Meetings Para 51
This statement by the administrator of his proposals must be accompanied by an invitation to an initial creditors’ meeting (Sch B1, para 51(1)).
Bankruptcy
This can only apply to individuals (including sole traders and individual members of a partnership). Bankruptcy petitions may be presented to the court by the individual, by creditors who are owed £750 or more, or by the supervisor of an individual voluntary arrangement. A bankruptcy order is made by the court.
Company Voluntary Arrangement (CVA)
A company comes to an arrangement with its creditors to pay the debts in full or in part over time. A CVA begins with the company (or its adviser) drafting a formal proposal at a Creditors’ Meeting to pay part or all of the debts. If the proposal is accepted by the creditors, the arrangement will become legally binding and the directors will retain control of the company.
Compulsory Liquidation
This is the winding up of a company or a partnership by a court order (a winding up order). A petition is normally presented to the court by a creditor stating that he or she is owed a sum of money by the company and that the company cannot pay.
The Official Receiver becomes liquidator when the order is made but an Insolvency Practitioner will be appointed to take over if the company has significant assets. The liquidator’s role is to realise the company’s assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
Compulsory Liquidators Appointed S 136
When a winding-up order has been made, the Official Receiver is initially appointed as liquidator (section 136, IA 1986). The company’s creditors and contributories may appoint another individual, who must be a registered insolvency practitioner, to act as liquidator (section 139, IA 1986). More than one liquidator can be appointed to act jointly.
Creditors’ Voluntary Liquidation
Here the shareholders pass a resolution to wind the company up without the need for a court order. A Creditors’ Meeting is held to nominate the appointment of a liquidator and consider a statement of affairs. Creditors can appoint a committee to work with the liquidator, whose role is to realise the company’s assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
Creditors’ Voluntary Liquidation Deemed in Consent Meeting
Creditors are now ‘deemed to have consented’ to a decision or resolution if 10% of creditors (by value) have not objected to it. In other words, if objections are not received by the specified decision date, creditors are ‘deemed to have consented’ to the decision or resolution.
Individual Voluntary Arrangement (IVA)
An individual comes to an arrangement with creditors to pay his/her debts in full or in part over time as an alternative to bankruptcy. The arrangement is set up by a licensed Insolvency Practitioner who will put it to a meeting of creditors. If the proposal is accepted at the meeting, the agreement reached with the creditors will be legally binding. An Interim Order is sometimes issued by a court and will immediately protect the debtor from any legal action by creditors.
Petitions to Wind Up
A winding up petition is a legal notice put forward to the court by a creditor. The application, in effect, asks the court to liquidate the company as they believe the company is insolvent. Proceeds of the liquidation can be used to pay back creditors.
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ICSM CREDIT
For information on ICSM visit www.icsmcredit.com or call 0844 854 1850.
ICSM, The Exchange, Express Park, Bristol Road, Bridgwater, Somerset TA6 4RR. Tel: 0844 854 1850. www.icsmcredit.com. Ian.carrotte@icsmcredit.com