6 Administration Alert
Large UK companies that have appointed, or are tipped to appoint, insolvency practitioners for all or part of their business. For the latest update, please check the BSR subscriber’s section.
DBC Foodservice has entered administration, with Baker Tilly appointed to handle proceedings. The firm was founded in 1902 as the Danish Bacon Company, but in the 1990s it expanded to supply a wider range of foods to retailers and the
catering industry from its 12 UK depots. Nine of its locations are based in England, with one in Wales, Scotland and in Northern Ireland. A number of buyers are said to be in discussions with Baker Tilly to purchase DBC Foodservice after it was put on the market last week, but as yet no buyer has been found for the firm. A statement from the administrators read: "DBC is a very well established business which has enjoyed a great reputation over a prolonged period. It is obviously very disappointing to see the company enter into administration. "We are in discussions with a number of interested parties, some of which are at an advanced stage. We are hopeful that we will be able to secure a future for certain areas of the business." The firm employs around 1,000 people across its various depots and is headquartered in Welwyn Garden City following a move out of London during World War II.
A buyer is being sought for consumer electronics company AJ Electronics after it fell into administration. The company, which is based on London’s Edgware Road, has appointed Alexander Kinninmonth and Duncan Beat of RSM Tenon as joint administrators. They have
confirmed that they are currently working with “interested parties” with a view to sell AJ’s goodwill and tangible assets. The company has been in business for 28 years and specialises in the retail, wholesale and export and import of electrical goods, including display screens and computer hardware. Kinninmonth said that the high street shop had suffered a drop in trading due to an increase in online spending. “Corporate insolvencies in the retail sector are on the increase and the impact of the internet and online shopping continues to have a significant impact on turnover,” he explained. Figures for the year to 31 December 2010 showed that the company’s turnover suffered a year-on-year fall from £24 million to £22.2 million, and its pre-tax profit fell from £317,000 to £59,000. The company is not the first high street electronics retailer to suffer the effects of increased online spending, with a number of operators of Sony stores across the UK going to the wall and Game Group currently struggling for survival.
High street fashion brand, Firetrap, has been partially bought out by Sports Direct in a pre-pack administration.
World Design & Trade, which operated the contemporary brands Firetrap UK and FullCircle, filed for administration at the end of last week, with restructuring specialists from Ernst & Young appointed to handle the process. The deal will see the company’s wholesale business, brands and concessions acquired by the sports giant, which in the last year has also acquired fashion retailer USC and premium chain Cruise. The deal secures 170 jobs with the company. Firetrap’s six stores, however, have all been closed, with the loss of 51 jobs. It is thought that Sports Direct was vying for the company with rival sporting brand, JD Sports. They had previously both contended to buy out the administration-struck outdoor pursuits chain, Blacks, earlier this year, with the bulk of it eventually being secured by JD Sports.
Firetrap has joined a growing list of companies that have succumbed to the difficult town centre retail conditions created by the recession. In January, Peacocks became the largest high street failure since the collapse of Woolworths in 2008, but was largely bought out by Edinburgh Woollen Mill. Video game vendor, Game, is also currently fighting for survival, with a deal said to be on the cards for private equity company, OpCapita, to acquire its debt.
Scarborough’s Royal Hotel and Clifton Hotel have both been sold out of administration as going concerns, saving all jobs in both businesses. The two historic hotels were bought out by subsidiary companies of the Alex Langsam-owned Britannia Hotels. The Royal was sold to Ambassador (East Cliff) Ltd and the Clifton was sold to Britannia Hotel Wolverhampton Ltd. The two properties were put on the market
last year when their parent company ERH (Scarborough) Ltd entered administration. David Whitehouse and Sarah Bell from Duff & Phelps were appointed joint administrators. Mr Whitehouse said they were very pleased to have secured successful sales for the seafront properties, which both offer expansive views over the North Sea. “Whilst trading conditions in the hotel and leisure sector in the UK remain difficult I am pleased to announce the successful sale of these two hotels,” Mr Whitehouse said. “The sale to an established hotel operator will now provide certainty to both employees and surrounding businesses.” The 118-room Royal Hotel dates back to the 1830s and has welcomed a number of famed historical figures, including former Prime Ministers, Winston Churchill and Harold Wilson. The Clifton Hotel has 70-rooms and is said to have been the location where war poet, Wilfred Owen, penned his famous poem, Miners.
Administrators are looking to sell the assets of West Yorkshire building company, Ashcroft Construction, after it fell into administration last week with the loss of 23 jobs. The Brighouse-based business appointed Antony Denham and Sarah Long from insolvency firm DL Partnership as joint administrators this month, who immediately made all of the company’s employees redundant. Insider
Media has reported Ms Long as stating that the company was a victim of its recent loss of turnover, which had been caused by the “economic climate and the general downturn in the construction sector”. The administrators immediately moved to wind up Ashcroft’s three remaining contracts, submitting them for review by Leslie Keats Quantity Surveyors. One of the contracts was terminated by the client upon the appointment of the administrators, but was deemed to have no significant saleable value. Another of the contracts was deemed to be practically completed, while the third was transferred to another contractor. The plant and equipment owned by Ashcroft Construction will now be sold, and the administrators have appointed representatives from Michael Steel & Co (Plant & Machinery) to orchestrate the sale. The administrators have been advised by Sarah Brittain of Lupton Fawcett Solicitors.
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