May Day is an interesting concept. Firstly seen as the traditional day to welcome Spring by agricultural and farm workers, it was later adopted by industrial operatives who wanted their professional endeavours recognised and rewarded with a day off as well. 

It is also an international sign of distress – coming from the French “M’aidez” or “help me”. 

We hope your business is enjoying more of the former than the latter and if you are lucky enough to get some time off or even a few minutes to yourself, it’s the perfect opportunity to catch up with all the important and interesting business and insolvency news stories from the past seven days that you might have missed.

You can find out why the latest monthly corporate insolvency figures are down but still higher than their pre-Covid levels; what 2024 could hold for the manufacturing sector; find out why directors’ disqualifications have doubled in a year because of bounce back loans; and all the implications of every financial change that came into effect in April – you can find these stories and more at our advice centre page.

Reader’s Digest

The Reader’s Digest has gone into administration in the UK after talks between its US parent group and the UK pensions regulator over a £125 million pension fund deficit broke down.  

The Reader’s Digest Association (RDA) said that the pensions regulator rejected a rescue plan to settle the longstanding liability so they placed the company into administration to look for a sale to any interested buyers. 

In the USA, the RDA filed for Chapter 11 bankruptcy protection last year to manage interest payments on a £1.4 billion debt although it is due to exit this after a successful financial restructuring. 

A statement from the RDA said: “The decision by the RDA UK board to place the UK company into an orderly insolvency process follows the recent decision by the UK pensions regulator that it would not support an agreement already reached between RDA UK, the trustees of its pension plan and the UK Pension Protection Fund to settle a longstanding pension plan liability.

“RDA does not expect the UK administration to have a material impact on its financial performance as the UK business has been operating with negative free cash flow, and without the contemplated restructuring the corporation did not see a clear pathway to profitability in the UK over the next several years.”

The world-famous Reader’s Digest compendium magazine has just over 500,000 UK subscribers and 177 positions are at risk of redundancy during the process. 

Editor in Chief Eva Mackevic said: “After 86 wonderful years, I am very sad to share that Reader’s Digest UK has come to an end. It has been my privilege and joy to contribute to this iconic publication for nearly eight years, leading its talented team for the last six. 

“Unfortunately, the company just couldn’t withstand the financial pressures of today’s unforgiving magazine publishing landscape and has ceased to trade.”

Triangle Of Sadness

A funding business set up to provide finance for an Oscar-nominated film is facing compulsory liquidation. 

Triangle of Sadness Limited was a Special Purpose Vehicle (SPV), a separate company to help minimise financial risk, set up by the film’s producers Philippe Bober and Mike Goodridge to handle the UK financing of the film. 

HMRC have filed a winding up petition as the company’s accountants have not filed VAT returns nor any accounts for 18 months. 

The SPV was listed as a co-producer on the project and has not been used since the film, which was shot on location in Sweden and Greece, wrapped shooting but while a business is active on the Companies House register it is required to file annual accounts with penalties for failure ranging from personal fines to criminal liability. 

If the accounts and VAT returns are filed late but correctly and the company can demonstrate that there are no outstanding VAT or other payments to be made then they can apply for the petition to be discharged. 

The film, about the sad, empty lives of the rich and famous, won the Palme d’Or at Cannes and was nominated for three Oscars including Best Picture but didn’t win any.

Everest

One of the UK’s biggest double glazing providers have announced they have appointed administrators. 

Everest double glazing has been owned by an investment company called Better Capital for more than a decade. It currently employs 350 staff in a variety of positions. 

Analysts note that Better Capital have been winding down their properties with Everest being one of their few remaining investments but expect several potential bidders for the company and its assets. 

The business went into a pre-pack administration in June 2020 as workers were forbidden from visiting customers in their homes. 

A statement from the administrators said: “Everest requires an immediate funding injection to relieve creditor pressure which, combined with significant investment in its marketing, systems and brand, can deliver increased market share, and a path to strong underlying profitability and growth.”

Worcester Warriors

The company which assumed control of Worcester Warriors Rugby Union club just over a year ago has now gone into administration themselves. 

Atlas Consortium took over the running of the business from administrators in February 2023. 

The club’s Sixway Stadium and surrounding land were sold to Atlas for £2.05 million at the same time with a non-refundable £500,000 deposit paid on February 1st. A deferred consideration of £1m was to be paid over a two year period which was subsequently brought forward to October 9 2023, a deadline which Atlas missed. 

£24 million of debt owed to unsecured creditors was written off at the time including banks, season ticket holders, trade creditors and directors.

John Barnes

Former Liverpool and England football John Barnes has been banned as a director after failing to ensure that his company paid tens of thousands of pounds of due tax. 

Between 2018 and 2020, John Barnes Media Limited failed to pay more than £190,000 in corporation tax and VAT to HMRC, who were the only creditors when the business ceased trading. 

Mr Barnes signed a disqualification undertaking banning him from being a company director for the next three and a half years.

A statement from Mike Smith, Chief Investigator at the Insolvency Service, said: “John Barnes had a legal duty to ensure his company paid the correct amount of corporation tax and VAT. 

“Instead, it paid no tax whatsoever between November 2018 and October 2020, despite receiving earnings of well over £400,000.

“This disqualification should serve as a deterrent to other directors that if you do not pay your taxes while directing money elsewhere, you are at risk of being banned.”

John Barnes Media Limited was founded in September 2012 offering media representation services with John Barnes as the sole director. 

Between November 2018 and October 2020, the company’s turnover was £441,798 but nothing was paid to HM Revenue and Customs in tax during that period, despite the company filing returns showing what the VAT payments should have been. 

£78,839 in corporation tax was due along with outstanding VAT of £115,272.

Complete Facade Systems

A Merseyside based facade specialist that worked on major projects including the Oxford Science Park has gone into voluntary liquidation. 

Complete Facade Systems (CFS) based in St Helens, made the decision to appoint liquidators after being unable to service their debts as they fell due. 

The business was established over 30 years ago, building up experience in facade design and installation. It specialises in the design, manufacture and installation of facades and after finishing work at the prestigious Oxford Science Park were working on a housing scheme in the West Midlands. 

The business had ten employees at the time of closure. 

Hughub

Insurance software provider Hughub has been placed into administration due to a lack of funding. 

Directors confirmed that senior staff members had deferred wages and directors had provided personal loans totalling £55,000 to help keep the business afloat. 

Despite generating revenue through its broker comparison platform Extranet Hub, the business had yet to generate a positive cashflow and relied on shareholder funding to cover running costs. 

Their digital platform has been sold to Open GI with four employees moving to the business with the remaining positions being made redundant. The news follows the retirement of previous CEO Jonahthan Davey after seven years in charge.

Eddy’s Food Station

A popular Scottish convenience store has gone into administration. 

Eddy’s Food Station ran three stores in Glasgow and Greenock but announced they had sold them in a pre-pack deal to CJ Lang which will protect the branches and keep 35 jobs. 

Eddy’s Food Station was launched in May 2022 with one store in Alloa.

Colin McLean, managing director of CJ Lang, said: “We’re happy to welcome these three convenience stores into the Spar Scotland family, following the sad news of its previous owner recently entering into administration. 

“We recognise the challenges facing many convenience store operators at the moment, but we are pleased we have been able to work quickly to secure the future of these stories and the store staff involved. 

“This will ensure local jobs are retained and the stores remain open to continue serving their communities.”

ARJ Construction

A Hertfordshire based contractor has filed notice of intention to appoint an administrator. 

ARJ Construction was formed in 1991 in Stevenage and specialises in residential, healthcare, education and commercial sector projects. The firm currently employs 136 workers in a variety of disciplines. 

They had just signed contracts to work on The Gates housing development project in Houghton Regis and to redevelop the Paradise Depot in Hemel Hempstead in partnership with Dacorum Borough Council.

The weather is picking up just enough to remind us that Summer is nearly here and underlines that we’re approaching the halfway point of the year already. 

Is your business making the most of it?

If you make an appointment for a free initial consultation with one of our advisors, you will learn about some new ideas and opportunities to use the rest of your time more effectively in your business to bring your plans closer to fruition.

You’ll also have enough time to implement them which could really make a difference in the second half of 2024 and in the future. 

All you have to do is get in touch!