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Elan leaves £6m debts

10th February 1994
Page 9
Page 9, 10th February 1994 — Elan leaves £6m debts
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Which of the following most accurately describes the problem?

by .luliet Parish • Elan International, the express freight and parcels delivery company, crashed last week leaving a £6 million debt and nearly all its 760 staff redundant The Birmingham-based firm appointed a liquidator on 2 February after failing to stein losses or successfully complete talks with its principal funder and potential purchasers.

The liquidator David Wilton at Cork Gully is keen to find a buyer for Elan, which operated 300 trucks and vans out of 18 depots. Meanwhile local hauliers will be able to tout for the annual Z30m worth of business Elan handled. All of Elan's traffic, mainly overnight parcels and computer hardware, is being returned to its source, says Wilton.

lie blames lower volumes in the increasingly cut-throat sector for the demise of Elan, which was the second major player in overnight parcel deliveries to give up on the UK domestic parcels market within two years: Federal Express withdrew from this market in May 1992, making more than 3,500 staff redundant.

Wilton could not quantify how long Elan had been losing money and could not give creditors assurance that they will receive a dividend. He is still accounting for the assets with the 40 remaining staff.

He will have more details at the creditors meeting to be held on 15 February—a venue is still to be decided_ Elan was founded by parcels courier DHL in 1983 and sold to Allegro Holdings in a management buy-in deal in 1991. DHL retained a 5% shareholding in the company.