All the important stories from the month are here
The Harvest Moon has officially passed, marking the start of meteorological autumn but with the spooky season and Halloween right at our doorstep, that isn’t the only reason for businesses to be scared this October.
There have been plenty of business and insolvency news stories that have happened last month including administration, CVA and liquidation stories that you might have missed while preparing for the colder months.
Catch up with them all here!
Wasps and Worcester Rugby Union
Last month it was announced that premiership rugby union team the Worcester Warriors had received a winding up petition from HMRC over unpaid tax bills. It has now been revealed that the Wasps have joined them in the fight for survival amid the threat of administration.
Both Clubs are being pursued for unpaid tax and have been served winding-up orders by HMRC.
Now the Warriors have been put into administration after being suspended by the Rugby Football Union from all competitions leaving them seemingly condemned to relegation.
The announcement was made by the Department for Digital, Culture, Media and Sport who are the clubs biggest creditor after supplying the team with £14 million last year to help alleviate the effects of the pandemic.
They said: “In order to give the club the best possible chance of survival, and to protect a significant taxpayer investment, we have agreed to the directors’ request to place the club into administration.”
The mens and womens teams were subsequently expelled from the Premiership and Premier 15s accordingly for failing to meet the financial requirements laid down by the Rugby Football Union (RFU).
These included insurance guarantees, an ability to meet staff payroll and a “credible plan to take the club forward”.
A spokesperson issued a statement which said: “We appreciate this is incredibly difficult news for fans, staff and players.
“We hope a buyer can be secured to allow Worcester Warriors to return to professional league rugby. It is so important that we continue to work with Premiership Rugby to improve the structure, governance and business model of rugby union in England.
Avonside
It has been confirmed, after being unable to secure funding to continue business in its current form, the Natwest backed roofing service provider has collapsed into insolvency proceedings.
The Avonside Group is a roofing services company which operates 39 branches across its 3 divisions: Avonside Roofing, Avonside Energy and Avonside Plumbing. Employing 450 people on a full time basis and a further 1200 contract labourers on the books.
A spokesperson said “The group experienced a period of disrupted trading during the pandemic which, alongside margin squeeze, the impact of underperforming divisions and financial reporting issues, resulted in a requirement for extended working capital facilities.
“Despite extensive efforts from the management team, shareholders and advisers, the group has been unable to secure the necessary funding from existing stakeholders, or third parties, to effect the required turnaround and enable continuation of trade in the current form.”
It is said that NatWest had rejected a proposal from Core Capital, its private equity shareholder, to inject new funding into Avonside, leaving its directors with no choice but to appoint administrators.
However all hope was not lost as they secured the future of nine Avonside Roofing branches, preserving 79 jobs via an administration sale to an industry buyer. The remainder of the roofing and plumbing sites within the group are expected to be closed imminently.
Festicket
Ticketing company Festicket is now heading into administration following a brief moratorium.
Festicket is a central booking system that specialises in selling packages around festivals and music events, who last month submitted a ‘notice of commencement of moratorium’ to the UK’s Companies House.
It was confirmed earlier this month that the moratorium was brought to an end on 30 August because “the moratorium was no longer likely to result in the rescue of the company as a going concern”, said a spokesperson.
Event promoters are keeping a close eye on the situation, with many taking to social media to air out their frustrations. Bristol club Motion issued a statement in which it said that it is awaiting funds from the company for recent events.
“Our event partners and Motion are owed in excess of £300,000 due to not receiving payments for tickets sold through their platforms,” it said. “Last weekend, we had an event which sold out at 3000 tickets, the promoter still hasn’t received all of their ticket funds for the event.”
Arjowiggins
Administrators have been appointed to 10 divisions of a historic independent paper manufacturing company which has led to 368 redundancies.
Arjowiggins Group UK produces fine and custom papers for various purposes including graphic design, packaging and labelling, and security printing.
In 2019, the UK operations were established through a management buyout following the insolvency of its French partner companies (Arjowiggins and Sequana). However the group hit difficulties following Covid-19, where they saw trading and cash flow negatively impacted. This was then further worsened by the increase in energy costs and the price of raw materials.
A spokesperson said “Unfortunately, and following on from the severe challenges posed by the pandemic, the significant economic headwinds which have been impacting industrial manufacturing businesses up and down the country, including skyrocketing energy costs and spiralling input prices, have proved to be overwhelming for the group.”
The group also owns and operates mills in Spain and China however this won’t be subjected to insolvency proceedings.
Vale of Mowbray Pork Pies
Historic pork pie manufacturer, Vale of Mowbary, has entered administration with more than 170 jobs.
Over the past couple of years the company has experienced many financial challenges from rising raw material input prices, increasing energy costs and sector-wide recruitment challenges.
Attempts to attract fresh investments into the business were made, but without any viable offers and without resources to continue trading, the directors have appointed administrators and closed the business.
A spokesperson for Vale of Mowbray, said: “The Vale of Mowbray was a proud family business with a loved brand that has been synonymous with pork pies for generations. But the increasingly difficult trading conditions being experienced by many energy and labour intensive manufacturing businesses have ultimately led to the business’ closure.
“We are urgently calling on any interested parties to come forward. In the meantime, we are preparing to wind up the business’ operations and move towards an asset sale in line with our statutory obligations. We are on site and supporting staff, through what is an extremely challenging time, as we support claims to the Redundancy Payments Service.”
Printwize
Printwize, an Essex-based interactive marketing services, has gone into administration.
In early 2019 the managing director and sales director left to work for a rival firm, this resulted in the loss of 60% of Printwize’s customer base as well as turnover dropping to £80,000 from £225,000.
By the time the pandemic hit in March 2020 they had rebuilt to around £160,000 per month, however many clients ceased trading due to Covid-19. This combined with the uncertainty and rising costs resulting from the war in Ukraine left the business struggling and no longer viable.
Printwize has been marketed for sale, with two offers received. However, for a better return for creditors it has been recommended that the business ceased trading and its assets sold on an open market.
Jubilee sailing trust
Southampton-based Jubilee sailing trust (JST) goes into administration after financial difficulties due to the pandemic and the cost of living crisis.
The decision was made to place the charity into administration after one of its principal creditors “threatened imminent legal proceedings to reclaim their owned credit”, said JST in a statement.
It added: “Every effort has been made to avoid this situation, including contacting all creditors to consider alternative repayment timeframes, or if they would be willing to forgive the funds owed to improve our balance sheet.
“We are grateful to those who were able and willing to assist us in this manner, however the debt forgiveness and the fundraising efforts combined were not enough to significantly change our position.”
Hesper Farm Dairy
Yorkshire yoghurt manufacturer Hesper Farm Dairy has ceased trading with immediate effect after facing spiralling costs.
The company had pivoted from being a traditional family farm to producing Icelandic style skyr yoghurt products in 2015 primarily as a way to deal with fluctuations in milk prices. They had deals with Morrisons and Booths stores to supply the product, however the impact of increasing logistics costs, coupled with broader economic headwinds, meant that a number of its contracts had become lossmaking in recent months.
Five employees have been made redundant as a result of the business entering the liquidation process.
A spokesperson said: “As the first UK farm to produce skyr, Hesper Farm Dairy was something of a pioneer.
“However, like so many other small businesses operating in the food and drink sector the company faced challenges in scaling up the business and the pressure this puts on costs and margins over the medium term.”
NRS UK
Administrators have been appointed at Livingston-based NRS UK (Noel Regan & Sons) after the company succumbed to spiralling supply chain costs and fixed price contract issues placing 47 jobs in jeopardy.
The business provided construction, civil engineering and power solutions to several public and private Scottish clients and projects.
A spokesperson said: “The administration has been caused by spiralling supply chains costs in 2022 was magnified by severe losses stemming from fixed price contracts, resulting in recent unsustainable cash flow and financial problems.
“As a result, the business has ceased trading with immediate effect.
“The business has been exposed to the well-documented problems of surging costs affecting supply chains and from fixed price contracts that resulted in involuntary losses. Despite the best efforts of the sole director, the business faced a range of cash flow challenges in recent weeks due to these issues and could not continue trading.
BEI Group
A training provider and three of its subsidiaries has become insolvent as several of its skills funding contracts were terminated with the loss of approx. 50 positions and nearly 1,000 students will have to transfer their learning to other providers as a result too.
Set up in 2019, the BEI Education Group provided commercial and apprenticeship training in different sectors such as retail, social care and IT.
They had their registration to provide apprenticeship training rejected earlier this year and its adult education contract terminated by the Education and Skills Funding Agency (ESFA).
One of the providers under the company banner, Create Care, went into liquidation in 2020, which the directors blame for the attitude and actions of ESFA.
A spokesperson said: “The agency rejected our contract refresh because of what happened with Create Care in 2020.
“From our point of view it is contentious because shareholders are not responsible for the debts of a company, and a parent company is not responsible for the debts of its subsidiaries.
“We took a struggling company back in 2020 with good intentions but it closed. Now the other companies in the group were judged on this event now even though there was no direct connection or common directorship.
“Despite putting a very strong business case together, the ESFA rejected it and closed it down, displacing a lot of staff and learners as a result.”
Under EFSA policy, the agency can terminate contracts where the director of a provider “is the subject of insolvency or winding-up proceedings.”
Harpers Environmental
A Yorkshire and North East industrial services and waste management business has ceased trading and called in administrators, with 80 jobs lost with immediate effect.
It was working on several sites and employed about 80 staff directly, alongside a number of sub-contractors.
All work has ceased and employees have been informed that they have been made redundant. All employee claims will be dealt with by the Redundancy Payments Service (RPS).
A spokesperson for Harpers Environmental said: “The business has been successfully trading for over 65 years and despite recently signing some large profitable contracts has been unable to address historic losses due to the pandemic and collect the cash required to continue trading.
“Whilst we have sought a buyer for the business in a limited timeframe it has not proved possible to secure a going concern sale and sadly the directors have had no option but to shut the business down and appoint the joint administrators.
“The administrators and directors are working with customers to ensure a smooth handover of contracts to alternative providers.”
Isle of Wight Harbour
The company that ran the Island Harbour in Newport, Isle of Wight has gone into administration.
Island Harbour was still operating and administrators were “trying to keep disruption to a minimum, both for the harbour users and for the onward sale of the site” as potential buyers were sought.
The previous owners, Uavend Investments LLP, has been declared insolvent.
The assets owned by the business include the Union Jack bus that featured in the Spiceworld movie starring the Spice Girls.
Yorkshire Lavender
One of the country’s top lavender producers has gone into liquidation.
Yorkshire Lavender based in Ryedale appointed liquidators who began informing creditors.
A spokesperson said: “Prior to the liquidation the company agreed a sale of the business and assets of the company to a connected company in a deal that meant all employees retained their jobs. This transaction will be scrutinised during the course of the liquidation.
“We are unable to make any predictions on the likely return to ordinary creditors at the moment as investigations have just commenced.”
Robert Woodhead
Midlands-based construction company Robert Woodhead has ceased trading with the loss of 122 jobs blaming a well-documented market conditions and impact of rapid price increases throughout the supply chain, coupled with fixed price contracts being identified as the root cause.
A spokesperson said in a statement: “The directors are devastated at having to make this decision.
“Having worked tirelessly to mitigate these issues over recent months, ultimately the business faced a range of cash flow challenges in recent weeks that proved insurmountable and concluded that the company could not continue trading.
“The board acted on the advice of experts confirming that the company was insolvent, that the business was no longer viable and that immediate steps ought to be taken to enable it to cease trading to mitigate accruing further losses to the company’s creditors. Appropriate steps will also be taken for the company to be placed into a formal insolvency procedure.”
Windsor Road Day Nursery
A popular day nursery in Newton Heath, Manchester, has closed down suddenly with immediate effect.
38 children have to find a new provider and staff also have to find new positions.
Owner Donna Johnson issued a statement saying she was heartbroken over the decision.
“The nursery has been struggling financially for a number of months due to a downturn in the requirement for childcare following the Covid-19 pandemic and we have been having to put money from our own personal finances due to the low funding rates and record high inflation rates to cover wages and bills.
“We had hoped that by September, we would have new children start with us in the new term and the business would get back on its feet. Unfortunately, that has not been the case and we took the difficult decision on Tuesday to close immediately as we would be unable to pay wages at the end of the month as the business was no longer sustainable.
“We are heartbroken that it has come to this. We understand that this is a very upsetting and unsettling time, but we have explored every option available to us to be able to continue to operate with no success.”
Once again last month’s corporate insolvency figures rose once more to their third highest monthly level this year and indeed this decade.
You wouldn’t be a good director or business owner if you weren’t concerned about what the following months will hold for your business. It’s what you do.
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If you are in or think you could be in this position then don’t wait for it to arrive – get in touch today to prepare for it properly.