Insolvency Archives - Grunberg & Co

Company insolvencies at record low

admin — Thu, 24 Jun 2021 14:44:00 +0000

Recent figures from the Insolvency Service show a 23 per cent fall in corporate insolvencies in April this year compared with the same month in 2020 and a 35 per cent fall from April 2019.

This year’s April figures were made up of a total of 925 registered company insolvencies, comprised of 819 Company Voluntary Liquidations (CVLs), 26 compulsory liquidations, 75 administrations and 5 Company Voluntary Arrangements (CVAs).
Despite the fall in corporate insolvencies, business owners are urged to remain on top of their finances, as the industry believes that the Government’s support measures have merely delayed the inevitable.
Insolvency levels are likely to rise once state funding ends and creditors can enforce their rights, so business owners must watch their cash flow and avoid over-trading.
Most importantly, if they were not in good financial shape before the pandemic, they should start planning for the second half of the year and seek advice if they believe they will struggle in the coming months.
Worryingly, Individual Voluntary Arrangements (IVAs), used by people in personal financial difficulty, rose by 22 per cent for the three months to the end of April 2021, compared to the three months ending April 2020.
This rise suggests that personal finances are coming under increasing pressure, and could mean that company owners and directors who have been unable to access Government support, as well as those that have lost their jobs, are now struggling financially.
For help and advice on related matters, please contact our experts today.

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Online fashion retailer Boohoo set to take over Debenhams brand, reports reveal

admin — Mon, 25 Jan 2021 17:15:46 +0000

Online fashion retailer Boohoo has acquired the Debenhams brand and website for £55 million, reports have revealed.
But the deal does not include the department store’s bricks and mortar premises, which are now set to close and result in the redundancy of up to 12,000 staff.
The 242-year-old high street retailer fell into administration last year after failing to secure a rescue deal for its business, which includes 124 shops across the country.
The store – which has been trying to find a buyer since the summer – attributed its demise to shopping moving online, but its situation worsened following the start of the coronavirus pandemic.
“The group will only be acquiring the brands and associated intellectual property rights,” Boohoo confirmed this week. “The transaction does not include Debenhams’ retail stores, stock or any financial services.”
The takeover will add to its existing online portfolio, which also includes high street brands Oasis, Coast and Karen Millen.
Commenting on the deal, Mahmud Kamani, executive chairman at Boohoo, said: “This is a transformational deal for the group, which allows us to capture the fantastic opportunity as e-commerce continues to grow. Our ambition is to create the UK’s largest marketplace.
“Our acquisition of the Debenhams brand is strategically significant as it represents a huge step which accelerates our ambition to be a leader, not just in fashion e-commerce, but in new categories including beauty, sport and homeware.”
Joint administrator Geoff Rowley added: “We are pleased to have secured the future for this great brand, and to have created the opportunity for a new Debenhams-branded business to emerge in a different shape beyond the pandemic.”
In related news, online retail giant ASOS is reportedly set to take over the Topshop, Topman, Miss Selfridge and HIIT brands from the Philip Green-owned Arcadia Group. The deal is also unlikely to include physical shops, putting 13,000 more jobs at risk.
For help and advice with related matters, please get in touch with our expert team today.

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Covid-19 rescue fund saves 135 grassroots music venues at “imminent risk of collapse”

admin — Mon, 24 Aug 2020 15:48:14 +0000

The Culture Recovery Fund has helped save 135 grassroots music venues at “imminent risk of collapse”, a new report has revealed.
The figures, published by the Department for Digital, Culture, Media & Sport (DCMS), show that more than £3.3 million in funding is being shared among 135 venues across England who applied for support to “survive the pandemic”.
These include The Troubadour in London, The Jacaranda in Liverpool, The Sunflower Lounge in Manchester, and the Night People in Manchester, which have played host to artists including Adele, Ed Sheeran and The Beatles in the early days of their careers.
With grants of up to £80,000 available, the emergency fund will cover on-going running costs incurred during the enforced closure of music venues, such as rent and utilities.
The funding forms part of the £880 million Culture Recovery Fund intended to support arts, film and culture organisations affected by Covid-19.
Welcoming the announcement, Darren Henley, CEO of Arts Council England, said: “This much-welcomed emergency investment from the government into grassroots music venues will have a profoundly positive impact on England’s music ecology, and today’s news will mean a great deal to the many artists, audiences and communities they serve across the country.
“I’m pleased that the Arts Council has been able to use its expertise to administer this fund, ensuring that we are supporting music venues in these challenging times.”
Mark Davyd, of the Music Venue Trust, added: “We warmly welcome this first distribution from the Culture Recovery Fund which will ensure that the short term future of these venues is secured while we continue to work on how we can ensure their long term sustainability.
“Both DCMS and Arts Council England have worked very quickly to fully understand the imminent risk of permanent closure faced by a significant number of grassroots music venues across the country, and the funding they’ve brought forward creates a real breathing space for under pressure venues.”
The Culture Recovery Fund is just one of many initiatives launched by the Government to protect vulnerable businesses. The rescue package also includes Business Rates Relief, the Coronavirus Business Interruption Loan Scheme (CBILS) and grant funding of up to £25,000 available through the Retail, Hospitality and Leisure Grant Fund.
For Covid-19 support and advice, please get in touch with our expert team today.

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Insolvency law changes to “better protect consumers”, Government announces

admin — Mon, 27 Jul 2020 15:56:10 +0000

Insolvent companies will no longer own the goods paid for in advance by consumers, it has been announced.
The planned change forms part of a raft of measures designed to better protect consumers in the event of business insolvency.
According to the Government, the proposed new laws will “provide clarity” for consumers about the ownership of goods they have pre-paid for by adjusting the rules on “transfer of ownership”.
Introduced in 1983, the current legislation states that if a company becomes insolvent, goods paid for in advance that are still in its possession may still be considered as assets belonging to the business – and can therefore be used to pay off the firm’s debts.
However, the proposed new laws would change when a consumer effectively owns the product.
This would apply to almost all scenarios where goods are not immediately handed over at the point of sale, for example, online shopping and commissioned goods and services.
The Government says it has now asked the Law Commission to draft new legislation setting out a list of events and circumstances which would be sufficient to transfer ownership to the consumer.
Commenting on the announcement, Consumer Affairs Minister, Paul Scully, said: “With more and more people prepaying for goods online, it is so important our laws are up to date to reduce the risk of customers losing out if a business unfortunately becomes insolvent.
“This consultation will look at how the law can be brought into the 21st century, providing clarity for those managing insolvencies and better protection for consumers.”
Law Commissioner, Professor Sarah Green, added: “The current transfer of ownership rules are shrouded in complex language which consumers can find difficult to understand.
“We believe it is time for the rules to be modernised so that consumers have clarity on their rights of ownership, especially in an insolvency situation.”
According to the latest statistics, more than 20 per cent of purchases in the UK required pre-payment in 2020, with the majority of those taking place online.
For business insolvency and rescue support, please get in touch with our expert team today.

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New Corporate Insolvency and Governance Bill to extend accounting deadlines

admin — Fri, 22 May 2020 14:54:58 +0000

The new Corporate Insolvency and Governance Bill will help maximise your business’ chance of survival throughout the coronavirus pandemic, it has been suggested.
The remarks come after the Government introduced the new laws to Parliament on Wednesday 20 May.
Under the proposed legislation, the bill will introduce temporary easements on filing requirements and Annual General Meetings (AGMs) and new corporate restructuring tools to the insolvency regime, and temporarily suspend parts of insolvency law to support directors in financial distress.
This includes giving companies more flexibility around important filing requirements by extending deadlines for confirmation statements, accounts, registration of charges and “event-driven filings”, such as a change to your company’s directors or people with significant control (PSC) register.
However, these changes have not yet come into force, meaning business owners should continue to comply with corporate reporting rules until told otherwise. If you are struggling to pay tax or meet key accounting deadlines as a result of the Covid-19 pandemic, businesses do have the option to extend their filing deadline by up to three months.
In the meantime, a number of financial support schemes are also available, including the Self-Employment Income Support Scheme (SEISS), the Bounce Back Loans scheme, the Coronavirus Business Interruption Loan Scheme (CBILS), and the extended Coronavirus Job Retention Scheme (CJRS), among others.
Commenting on the proposed changes, a Companies House spokesperson said: “The Bill was introduced on Wednesday 20 May and will now make its way through Parliament. Many of the measures in the Bill will need secondary legislation before they come into force, and this will be introduced in due course.
“Nothing will change until that legislation is introduced.”
For support meeting your reporting deadlines or accessing corporate finance, please get in touch with our expert team today.

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