Bulmers handicapped by pre-pack stigma
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By Christopher Walton THE ‘STIGMA’ OF the pre-pack deal that led to Bulmers Logistics becoming Bulmers Transport had a detrimental effect on the ability of the company to trade successfully before it folded for a second time, according to its administrators.
Bulmers Transport entered administration with outstanding debts totalling £3.2m after it suffered a dramatic drop in cashlow in the months preceding its demise in February. Creditors are unlikely to receive any outstanding debts.
According to documents iled by joint administrators John Sallabank and Paul Boyle, of Harrisons Business Recovery and Insolvency, potential customers had become more wary of using the irm for haulage after the pre-pack administration deal saw Bulmers Logistics assets sold to Bulmers Transport for just £1 in January 2009.
Furthermore, suppliers were unwilling to extend credit facilities, with some only dealing on a pre-payment basis, affecting its cashlow.
Sallabank says: “I do not think that creditors will receive their debts. The company was operating at a reduced level to where they were before. They tried to make eficiency savings but a bad debt [totalling £120,000 following the insolvency of customer Bulk Concepts] forced the company to cease trading. It is possible that the company never had the ability to trade at the scale it was.” ● For more details on the administration of Bulmers Transport, go to www.roadtransport.com
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