Children’s beds manufacturer Kids Funtime Beds Ltd has been sold in pre-pack deal worth £60,000 after entering administration.
The company suffered a reduction in turnover and was impacted by the rise in the cost of materials. Due to this increase, the company rose prices by 38% since January 2021 but saw demand weaken, going from suppling around 75 beds at its peak to 25-30.
The fall in turnover, from £2.2m in 2019 to £1.5m in 2021, led to cashflow issues with the business cutting staff numbers from 32 to 11 to reduce costs. Pressure mounted as its major timber supplier filed a winding up petition against the company in May.
The HMRC also had claims of £112,000, which administrators said it may receive some repayment. Meanwhile, unsecured creditor claims, valuing £373,000, are expected to suffer a shortfall of the entire amount.
Included within these claims is £100,000 owed to Funding Circle, £79,000 owed to Lawcris Panel Products, £40,000 owed to Aldermore Asset Finance, £40,000 owed to Santander, £23,000 owed to Morrells Woodfinishes and £13,000 owed to BHK UK.
Ahead of its administration, the company agreed a license deal with Funtime Beds Limited, a connected company and one that would allow trade to continue. This license was agreed on 19 April 2022.
Upon the appointment of Mike Dillon and Andrew Poxon, both of Leonard Curtis, as joint administrators on 27 May 2022, the business was sold to Funtime Beds Limited in a pre-pack deal worth £60,000. This is to be paid over six instalments up until September 2022 with the first £10,000 paid upon completion.