Sale price of kitchen furniture firm revealed following pre-pack deal

Kitchen furniture retailer and manufacturer Harvey Jones has sold in an accelerated pre-pack deal worth £400,000 after entering administration.

Chris Pole and Ryan Grant, both from Interpath, were appointed as joint administrators of Harvey Jones Limited and Harvey Jones Manufacturing Limited on 23 February 2024.

In the build up to its administration, the group had been adversely impacted by an unreliable order book and a fall in consumer demand, which led to creditor stretch, liquidity pressure and an EBITDA loss of £3.8m for the year ending 31 December 2023.

The directors implemented commercial changes to the deposit structure for customers in order to improve liquidity, however, this was not enough to rescue the business.

Following a process of exploring options available for the business through Interpath, alongside the HMRC taking steps to file a winding up petition, the directors accelerated a pre-pack agreement.

Upon appointment, the group was immediately sold to newly incorporated BB 2024 Limited, an entity owned by RBC BlueBay Asset Management, saving all of the 104 employees who moved over to the new company as well as its 27 showrooms across the UK.

The total sum of the sale valued £400,000 and was paid in full on completion. The sale also secured customer orders that have already paid deposits, which will be fulfilled under the new business. This reduced potential creditor claims by £3.6m.

Administrators detailed that on appointment there were three secured creditors, Allica – owed £0.8m, Coniston with an indebtedness of £6.1m and Barclays Bank. “Based on current estimates, it is likely that there will be a distribution to the first ranking secured creditor only and it is expected there will be a shortfall on the amount owed,” the report said.

Furthermore, administrators added that it is unlikely there will be a dividend for preferential and unsecured creditors, with a total shortfall expected to be in the region of £18.1m.

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