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Short on answers
Page 18
Page 19
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Following an investigation into the administration of two haulage firms, a third has hit financial trouble. CM speaks to ex-haulage bosses who claim they are out of pocket.
FEARS THAT AN established Norfolk haulage firm was on the verge of financial meltdown have proven correct after administrators were called in to handle the affairs of John Mack (Haulage).
The appointment of insolvency practitioner Duncan Morris at the Dcreham-based business came just days after CM revealed its previous owner was in dispute with its new directors, Alex Rawlings and Shahid Hussain, over money owed to him from its highly leveraged sale in November 2007
This mirrors an almost identical dispute that former haulage boss Eric Short is also currently having with Rawlings and Hussain over payment for his Newcastle firm that he sold in December 2007.
William Huhne, who was managing director of John Mack (Haulage), says he will be seeking legal advice in an effort to claw back the six-figure sum he believes he is owed by the directors.
In yet another twist, a CM investigation has found that a new company. John Mack (Haulage) UK, was registered at Companies House on 6 May, 21 days before John Mack (Haulage) went into administration (CM 28 May).
New 'UK' business
This new company's address is listed as "C/0 John Mack (Haulage)" and its sole director is Jeff Hague, an ex-driver of Liverpool's Thorburn Transport, which lost its licence earlier this year. Hague confirms he is the director, but he declined to answer any questions. Rawlings is listed as a shareholder.
When CM contacted what we believed to be John Mack (Haulage), a spokesman, Robin Baker, said staff moved over to the new 'UK' business on 1 June. He adds: We are now trading as John Mack (Haulage) UK. I am transport manager; I have always been transport manager. I helped build it up from three trucks to the 17 there is now.
Baker also claims that all creditors have been paid. This shift over to the new firm came just a week after CM was told about concerns over the future of John Mack (Haulage) and its precarious financial state.
As previously reported, Hulme was originally approached by a company called Boston & Maine asking if he wanted to sell John Mack Haulage to Rawlings and Hussain. A deal was struck in which he would receive a lump sum plus 18 monthly payments, but these instalments stopped three months ago.
Personal guarantees
Hulme says: "I had personal guarantees from Shahid Hussain and Alex Rawlings. I wouldn't have sold the company without a personal guarantee for a substantial part of it.! have not yet contacted the lawyers, but I will he doing very shortly. I will pursue it to the bitter end."
Further investigations by CM have revealed that the previous owner of Eric Short Haulage is also out of pocket after selling up to Rawlings and Hussain.
Eric Short sold his company that he had built up over 35 years to the two men in December 2007, and he tells CM that he is owed an estimated £41000.
Eric Short Haulage eventually went into administration less than 18 months after the sale, and blame has been placed on the economic downturn and the highly leveraged deal that saw the business transferred to Rawlings and Hussain via one of their nontrading entities. Duncan Morris of the Redfern Partnership was again appointed as administrator.
Commenting on the speed of its decline, Short says: "It doesn't leave a nice taste in the mouth at all. I was an owner-driver for 10 years before my work doubled and then tripled up."
The fact that Hulme secured personal guarantees may prove to have been a shrewd move.
Short says he was unsuccessful in acquiring these when he sold his business for a "seven-figure sum': and potentially he could become embroiled in a protracted battle in order to retrieve the six monthly payments of around £7,000 each he claims he's still owed.
This deal was also arranged through Boston & Maine, which contacted Short via letter -out of the blue":
As a result, Short sold the transport side of his company, but retained the warehouses, and he says he agreed to rent these to Rawlings and Shahid for around £40,000 a year, which was paid directly into his pension company. He says by February of this year, they were forced to send in bailiffs after the rental payments dried up, but eventually this was resolved when an electronic transfer was set up for the outstanding amount.
Re-financed
Short says: "Eric Short Haulage lasted from December 2007 to April 2009 that's barely 18 months. Everything was re-linanced, the whole thing was completely overvalued from the start, and we couldn't get our heads around it. But we have got 90% of our money and lost out on just the last six payments."
Insolvency practitioner Duncan Morris did not respond as CM went to press.
Rawlings and Hussain did not return CM's calls. •