A Manchester-based soft furnishings and window hardware supplier was sold for almost £2m following its administration. The company was placed into administration on 24 December 2024, after experiencing significant financial difficulties. These issues were attributed to liquidity problems, mounting creditor pressure, and legacy debts, exacerbated by a new IT system implementation.
Photo: Mzuri Group.
Prior to its insolvency, the company had engaged in talks with the Mzuri Group for a potential acquisition, but the group opted out after a due diligence review. As a result, the company was unable to meet its liabilities and entered administration.
Upon entering administration, the company was marketed for sale to 78 potential buyers, receiving three responses. Mzuri Textiles Ltd, a subsidiary of the Mzuri Group, made an offer of £1.8m, which was accepted. Following the sale, all 49 employees were transferred under TUPE regulations.
In terms of creditor repayments, HSBC, owed £300,000 as a secured creditor, and HSBC Invoice Finance, owed £1.2m, were both fully repaid. However, Loan Note holders, owed £1m, are expected to face a shortfall, and HMRC, owed £487,000, may receive some repayment. Unsecured creditors, totalling £2.1m, are expected to see no repayment.
The purchaser, Mzuri Textiles Ltd, now trades under the name Evans Textiles and was incorporated in October 2024.
Source: www.bigfurnituregroup.com