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Year long 1576 liquidation process begins as £300,000 debts revealed

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By The Drum Team, Editorial

April 25, 2008 | 2 min read

1576 collapsed owing creditors a total of £287,000, according to an initial report by interim liquidators Grant Thornton.

1576 collapsed owing creditors a total of £287,000, according to an initial report by interim liquidators Grant Thornton.

Primary creditors included print and production company Applecroft, which were owed £28,000. However, K&M Scenic Productions, Method Two, IPC Media and Mallinson Television Productions were numbered amongst other creditors, being owed over £10,000 apiece.

The report gave an outline of events leading to the insolvency: “The company moved to larger premises in March 2006, however the rent was significantly higher than the company had previously paid.

“In 2007 a dispute arose which resulted in the resignation of two directors. As a result of the dispute, the relocation and other issues, the company incurred a loss of £386,515 for the year to 30 September 2007.

“Following the loss incurred and the resignation oftwo directors, David Reid took professional advice on his position and elected to continue trading.

“The company refinanced in October 2007. Following the refinancing the company initially traded profitably and the management accounts showed an operating profit for the two months ended 30 November 2007.

“However, the impact of reduced spend by some of the company’s big customers, and the loss of some key accounts resulted in the company incurring significant losses in December 2007 and January 2008.”

As a consequence, Reid decided to cease trading.

Grant Thornton has now been appointed official liquidators and will complete the winding up of the firm. The most creditors can now expect is 10p in the £1.

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