PBC expands in Coventry

In some quarters this may be the worst kept secret but officially we can now announce the retirement of David Halstead Bottomley who has been in partnership with Paul Rogers at Bottomley & Co for over 10 years.

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As regards our new beginnings, we can reveal that, as David bows out, Paul and the team at Bottomley & Co, have joined Gavin Bates, Gary Pettit and Kym Carvell of PBC Business Recovery and Insolvency Limited, creating PBC Bottomley.

The team have already moved into new larger premises at the Coventry University Technology Centre. Paul and Gavin are well-known as regular faces on the Coventry & Warwickshire networking circuit.  Paul said, “I have known Gavin for many years and I could always rely on Gavin to give me a straightforward answer, so I am looking forward to working together”.

Paul went on to say ‘It is clear that we have had similar ideas and philosophies. So when this opportunity arose it was the ideal time for bringing together our expertise and to provide an enhanced service to Coventry & Warwickshire’s businesses and beyond.

Gavin said, “We look forward to building on our combined expertise to provide expert advice to all stakeholders on the risks in business and the solutions to insolvency”.  The team at PBC Bottomley are planning a stakeholder event at the end of the summer, so watch out for the invitations.

The Castle (Wellingborough) Limited

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The joint administrators announced yesterday that The Castle (Wellingborough) Limited is to be placed into liquidation and all theatrical performances and activities have been cancelled with immediate effect.

Joint administrator, Gary Pettit, said, “We have been in constant dialogue with the Council, who have supported The Castle over the past few years, but sadly we have no option but to close the business down. There has been a lot of interest shown in taking the theatre forwards and non-disclosure agreements were issued to those parties, however there are some complex legal and constitutional issues that prevent us from following up this interest and we are unable to meet the statutory purposes of the administration.”

“As a result, the company will be wound up by the court and the property will be handed back to Wellingborough Council. We will be reviewing all advanced bookings we received for future performances and we will be in contact with those people in due course.”

Questions:

  • How many staff will this affect? Sadly, we have had to issue redundancy notices to 31 staff members this afternoon. All salary payments are up to date.
  • Will all costs to performers/suppliers since your appointment be paid in full? All post-appointment costs will be paid in accordance with the Insolvency rules regarding trade expenses.
  • What happens to costs from performers/suppliers prior to your appointment? Current indications are that we will not be able to make any payments to creditors for outstanding debts that arose prior to our appointment. However, the full position will be disclosed to these creditors within the liquidation process.
  • What does ‘liquidation’ mean / what is the process now? The Court will place the company into liquidation, meaning it affairs will be wound down. As the building is owned by Wellingborough Council, it will be secured and handed back to them to manage going forwards. All assets owned by the company will be sold and any funds generated will be distributed in accordance with the insolvency rules. As the company is placed into liquidation, there will also be a statutory investigation pursuant to the Company Directors’ Disqualification Act 1986 – this is a condition of liquidation and does not infer that there was any wrongdoing at this stage.
  • What is happening to the Theatre?  The building will be closed, secured and handed back to Wellingborough Council. It is entirely the Council’s decision as to future use or development. In our personal view it is not viable to run this entity just as a theatre, it needs to be developed as a wider service.  Therefore, we do not anticipate there will be any future theatrical activity for at least 2 years.
  • How many people expressed an interest in The Castle? There were 7 expressions of interest in the business and two further expressions of interest in the property for developmental purposes. We have been unable to secure the Council’s full commitment for future support for The Castle, therefore we are unable to do anything further.
  • What happens to people who pre-booked tickets for performances which are now cancelled? All tickets booked after 13 April 2016 will be refunded in full. We are in the process of contacting these people, but if they have not heard from us by Friday 8th July then they should contact PBC on 01604 212150.  Anybody who purchased tickets before 13 April 2016 will be entitled to claim as a creditor in the administration, and as stated above, it is unlikely we will be able to make payments in this regard.  Alternatively, if the tickets were purchased on a credit card, you should contact your card provider who may be able to issue a refund.

 

 

Goodbye Miss Amos, Hello Mrs Gent!

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Everyone at PBC would like to offer their congratulations to Jenny, who married Matt on 2 June, and wish them a long and successful marriage.

Jenny’s new email address is jennygent@pbcbusinessrecovery.co.uk

 

 

Are CVAs viable?

How many High Street retailers can you think of whose name has been confined to the annals of history? I can think of 15 and that excludes the latest to fall victim, being BHS and Austin Reed.

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BHS entered into a company voluntary arrangement (“CVA”) with a 95% creditor approval. It included landlords of 87 (out of 164) stores agreeing to a 75% cut in rentals as a compromise for helping the retailer survive.  So why did the CVA fail?  It may surprise readers to learn BHS was the eighth High Street retailer to attempt entering into a CVA as a form of restructuring.  However, only two of them are succeeding.  A big problem for businesses of this scale is the enormous sums of money generally employed.  For example, in the case of BHS they needed to raise £100 million to cover wages and trading costs when as a rule suppliers tighten up credit and supply terms post CVA approval.

CVAs were designed as a tool for restructuring businesses that were enduring short term cash flow issues. Behind it there should always be a core viable business where some operational changes may turn the company fortunes around.  The benefits to creditors include a better return than alternative insolvency procedures and, in most cases, they preserve a customer going forward.

Provided the CVA proposals are realistic the principal risks to a successful CVA are the impact of unforeseen issues (such as a detrimental impact on the field of trade or adverse weather where the company operates in logistics, for example) and creditors imposing onerous demands that will doom the CVA to fail. Many times creditors will simply reject perfectly good CVA proposals due to a lack of understanding.  That is not a criticism of the voting creditors; merely a fact they are being asked to accept not being paid in the short term, the payment they receive is likely to only be part payment and would you also continue trading with the insolvent company as if nothing happened.  The real point is accept the lesser sum offered or face the reality of 100% write-off if an alternative route is demanded.

At PBC we have assisted numerous companies restructure and survive using a CVA as the vehicle. Sometimes it can be a simple case of we can see the wood for the trees.  The more successful outcomes arise where directors/partners seek advice at an early stage before the creditors’ antagonism reaches uncompromising levels where biting off your nose to spite your face may prevail in their voting attitude.

Oh, for those readers still wondering who the 15 retailers I could think of they are……. available on request!

At PBC Business Recovery and Insolvency we can advise you whether a CVA is appropriate. If appropriate, we will firstly assist you with the preparation of the proposal and then act as nominee and convene the meeting of creditors. Should the proposal be approved, we will then act as supervisor.

PBC Business Recovery & Insolvency offers a free one hour consultation to discuss your situation and the possible options available.  Call Gary Pettit or Gavin Bates on 01604 212150 completely confidentially.

Did you know PBC can offer mediation services?

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The philosophy behind Alternative Dispute Resolution is to encourage parties to consider resolution of their dispute by way of mediation rather than the (often) costly route of court intervention.

 

Insolvency is a highly specialised field that is constantly exposed to legal argument. At PBC, we say a dispute is most likely to be resolved if the mediator is equally specialised.  As a long-established and well-known appointment-taking insolvency practitioner, Gary Pettit is also an accredited mediator with CEDR and now offers to assist parties resolving dispute by way of mediation.

 

Indeed, Gary has recently received commendation from the chief executive of one of the country’s leading providers of finance to insolvency practitioners who said “I can recommend Gary very highly. He did a super and well balanced job on one of our cases recently. He is now on our shortlist for future cases”.

 

Should you be involved in an insolvency-related dispute where mediation has been (or is being) considered then we at PBC fail to see how the only known mediator who is also a current appointment-taking insolvency practitioner cannot be the right person for you.

 

For more information, see here or call Gary on 01604 212150.

 

PBC appointed joint administrators of The Castle (Wellingborough) Ltd

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The Castle (Wellingborough) Limited, operators of The Castle Theatre in Wellingborough, entered into administration on Wednesday 13 April 2016, with Gary Pettit and Gavin Bates of PBC being appointed joint administrators.

 

The directors were compelled to act in the best interests of the company’s creditors following the recent announcement by Wellingborough Council that they had terminated the contract to operate The Castle Theatre. Legal advice is being sought on this matter and nothing further can be added at this time regarding the administration and its circumstances.

 

All performances and other community activities will, as far as possible, continue to go ahead and staff and performers will be paid by the administrator through ticket sales and merchandise revenue. Gary Pettit, joint administrator, commented “This is very sad news for the Wellingborough community and, whilst we are working hard to find a solution so that The Castle can remain a focus in Wellingborough, we would encourage you all to continue to support the theatre.”

 

The full level of debt is still being quantified, however it is known that the company inherited a £500,000 pension shortfall and this is their biggest outstanding liability. All known creditors will be notified of the administration and registration procedure within the next 5 working days and any creditors who have not received information from PBC Business Recovery & Insolvency, the appointed administrators, by Thursday 21st April should telephone 01604 212150.

 

There are 38 staff involved at The Castle Theatre and, although there are no immediate plans for redundancies, sadly this cannot be guaranteed.