What stories have you missed from the past seven days?
As we head towards the final bank holiday weekend of May, it’s the perfect time to catch a breath and also catch up with all the important business and insolvency news stories from the past seven days.
So if you want to know more about what directors can do about battling inflation and rising prices or why outstanding bounce back loans are leading to more directors’ disqualifications you can find them all right here.
Party Pieces Holdings
A party supply business founded by the Princess of Wales’s parents has been sold in a pre-pack administration deal.
Party Pieces Holdings, which was founded by Carole and Michael Middleton in 1987 was sold to the Teddy Tastic Bear company which purchased the business and its assets.
A statement from the business said: “Party Pieces is a well-established brand with a proud British heritage, but like many other companies, across the retail space, had been impacted profoundly by the effects of the pandemic and the ensuing restrictions on social gatherings.
The company sold children’s party paraphernalia ranging from balloons to fancy dress costumes online. The Princess of Wales previously worked for the company including taking photographs for the website but left in preparation for her life in the royal family.
Her sister Pippa also worked for the business and on its online customer magazine called “The Party Times”.
Great Annual Savings
A Seaham based energy consultancy Great Annual Savings (GAS) has gone into administration after the High Court rejected a restructuring plan.
Arguing against a winding up petition bought by HMRC, the company was hoping to remain trading but the decision will see the loss of 100 posts for a business which had sponsored Sunderland AFC over its 10 year existence.
They helped businesses to reduce their variable costs in energy, water, telecoms, merchant services and insurance. The company continued to trade during the pandemic and subsequent lockdowns when staff were furloughed but built up liabilities owed to HMRC that challenged them for repayment.
A spokesperson for the business said: “GAS had been a profitable, growing business prior to Covid-19 but has been significantly impacted by the pandemic and the subsequent energy market crisis over the last 18 months. As a result, the directors put forward one of the first Restructuring Plans for an SME trading business to reduce its liabilities to sustainable levels.
“However, the court did not sanction the plan and the directors had no alternative but to seek the appointment of administrators. Regrettably, this also meant all 115 staff were made redundant on appointment.”
In the judgement Mr Justice Adam Johnson detailed how there were 15 classes of creditors within the restructuring plan and that at 12 of the 15 meetings, the plan achieved 100% support. However HMRC rejected the plan at one meeting, and at another meeting two out of three energy suppliers also voted against the plan.
In his judgement, Mr Justice Johnson said; “Historically, the operations of the company and the parent company have been successful, on paper at any rate. In August 2019 the parent company returned a dividend to shareholders of roughly £19 million.
“Under the plan, the estimated return to HMRC is £600,000 – the equivalent of 9.1p in the pound assuming a debt of £6.6 million. I consider that HMRC acted rationally in voting against the plan. Given its status as a major in the money creditor, and the strong terms in which it has voiced its objection, not only in light of the facts of this particular case but also given its critical public function as the collector of taxes.
“I think HMRC’s views deserve considerable weight. The company has not discharged the evidential burden of showing that HMRC would not be any worse off under the plan.
An HMRC spokesperson said: “We are reviewing the findings of the court. We will continue to support customers with tax debts and do everything we can to help those who engage with us to get their tax affairs in order, including offering payment plans.”
Alcester based baked goods supplier Fatherson Bakery has announced that it has gone into liquidation.
A statement from the business issued on social media said: “After 15 years Fatherson Bakery has gone into liquidation today and has closed its doors for the last time.
“On behalf of the team, we would like to thank our loyal customers for your support and patience over recent months.”
Founded in 2007, Fatherson Bakery had their products including cupcakes and pies stocked by Co-Op, Budgens, Nisa, Londis and Spar stores across the UK.
Named Bakery Manufacturing Company of the Year by Food Manufacture magazine in 2020, the company had 100 employees.
Nationwide cycling distributor 2Pure has gone into administration with up to 50 positions in danger of redundancy.
First incorporated in 2006, the company operated across the cycle and running sectors signing up with tubeless tyre sealant manufacturer MilKit and eco-friendly bike cleaning product company Kingud as clients.
A spokesperson for the company said: “In line with industry trends, the company suffered significant supply chain disruption followed by reduced consumer demand and inflationary pressures.
“In addition, the weaker pound had a significant adverse impact as the company predominantly purchased goods in US dollars from suppliers in the Far East.
A building specialist that a decade ago was recognised by the Sunday Times as the UK’s fastest growing privately owned construction company has gone into administration.
ME Construction Ltd and MEC Groundworks, their civil arm, have both appointed administrators with the immediate loss of 35 positions.
The businesses specialised in small and medium residential, commercial, healthcare and school projects exclusively within the M25 area in and around London.
Directors said the company was affected by reduced margins and an unsuccessful acquisition which subjected the business to significant liabilities. The management of the business was also impacted when the managing director had to take an extended period of leave due to health issues.
Directors tried to sell the business but after all avenues were extinguished, administration was the only remaining viable option.
A fresh fruit distribution company in Kent that had been operating for over 20 years has gone into administration this week with the loss of 30 positions.
The directors of Coolfruit blamed the current economic situation for the collapse.
The business operated refrigerated lorries to transport fresh fruit across the UK but rising overheads and additional operational difficulties including the loss of its operator licence, which is a UK legal requirement to operate heavy goods vehicles, meant that there were few options remaining.
The company’s assets will be sold in order to compensate creditors
Stone Plus UK
A top Northamptonshire based stone supplier has gone into administration.
Stone Plus UK supplied builders’ merchants and landscape centres with landscaping products including natural stone, concrete and porcelain.
Directors confirmed that the company had “experienced financial difficulties due to shipping problems and cashflow pressure, which led to significant debts accruing and made the business unviable.”
As a result, three full time employees have been made redundant while administrators seek to sell the business as a going concern.
Dead Vibey Leisure
A Newcastle based leisure company which operated The Hustle pub and an events venue called The Loft has gone into administration with the loss of 80 positions.
The decision was made to cease trading and appoint administrators due to an ongoing investigation by the Financial Conduct Authority (FCA)
Wippell & Co
An Exeter based manufacturer of clerical clothing and academic gowns that could trace its roots back to 1789 has announced that it has gone into administration and will close by the end of the year.
Wippell & Co began trading in Devon in the 18th century as a grocer but became an academic and clerical outfitter and supplier of church furnishings making handmade garments ranging from cassocks and altar frontals to graduation gowns and mortarboards.
44 positions are now discussing redundancy terms.
Robin Richardson, chairman and director, said: “It’s an incredibly sad day and I want to pay tribute to all my colleagues. We will be supporting everyone through this difficult period.
“Most people, including incredibly skilled embroiderers, seamstresses and cutters have worked here for decades. We are continuing to trade, completing and taking orders in the coming months, including all commitments to servicing and fulfilling all graduations for 2023.”
He confirmed that the announcement comes after two difficult years trading during the pandemic, with the company losing hundreds of thousands of pounds as university graduation ceremonies and other face-to-face events stopped.
Their customers included universities and churches all over the UK and overseas. The firm was the first business to have a telephone line and electric lighting in Exeter and during both world wars switched to making and supplying military clothing and equipment, including parachutes and torpedo mechanisms.
Some people think insolvency news is negative but it’s actually informative because it gives directors and business owners tips on what can happen to their business if they leave problems unaddressed and what they can do to avoid them.
One guaranteed way to give them more ideas is by arranging a free consultation with one of our team of expert advisors to discuss the unique challenges their business faces.
An advisor will provide them with a range of options they can consider implementing that could help them resuscitate and re-energize their business for the rest of 2023 and beyond.
All they have to do is to get in touch.