IPA exclusive industry update from Insolvency Insider

IPA Insolvency Practitioner newsletter, April 2024

A specially curated selection of the top stories for IPA members from Insolvency Insider Editor, Dina Kovacevic. More information on all the stories and the link to subscribe to the newsletter is here.

Recent insolvencies

• No Ordinary Designer Label Limited trading as Ted Baker, a popular fashion label which employs almost 1,000 people, entered administration on 22 March. The company cites “damage” done and arrears accumulated during its partnership with Dutch company AARC Group. Ted Baker decided to terminate the partnership with AARC on 29 January after AARC allegedly failed to meet financial obligations and inject required funding into the business. Benjamin Dymant and Daniel Smith of Teneo were appointed joint administrators approximately seven weeks later, and stated that the business had traded well below forecast in Q4 2023, building up a significant level of arrears. Ted Baker Holdings, Secure Trust Bank and Barclays Bank have registered charges against the company.

• IDMH Ltd trading as Lighthouse, a Sheffield-based modular housing manufacturer, entered administration on 22 March. The company, which was founded in 2020, manufactures timber framed houses, apartments and bungalows on its production lines. It reportedly suffered cashflow issues in recent months and entered administration after efforts to secure a sale of the business were unsuccessful. Richard Goodall and Martyn Rickels of FRP Advisory were appointed joint administrators. All 113 members of staff have unfortunately been made redundant. Craig Burkinshaw and 3FS Capital have registered charges against the company.

• The Buffalo Farm, Scotland’s largest buffalo farm and butchery, entered administration on 11 March. Launched in 2005, the Fife-based farm also includes a shop, cafe, and buffalo mozzarella business. Owner Steven Mitchell said that the farm had suffered due to factors including COVID, wars, soaring energy bills, cost-of-living crises and TB. However, due to a loan from a friend, Mr Mitchell was able to safeguard the business, jobs and animals via a pre-pack sale completed on the appointment of joint administrators Chad Griffin and Callum Carmichael of FRP Advisory. Allica Bank has a registered charge against the company.

Insights

• Kyle Forbes, Rachael Markham, Charlotte Møller and Kathryn Walters of Squire Patton Boggs examine the potential consequences of discharging a security registration in error and provide a helpful summary of whether and how corrections can be made. 
• Richard Rigby and Monique Perks consider how companies in distress can get ahead of a PR crisis through an intricate communication balancing act, with management needing to convey the appropriate detail and tone on negotiations with potential buyers, changes to the company structure, or other significant developments to employees, investors, and customers, while simultaneously engaging with the media to address misconceptions or concerns.
• The team at Freshfields examines how a series of important decisions have made it clear that court-based restructuring processes should be approached from the outset as pieces of litigation, and explain why “success” in the context of a contentious restructuring process usually means de-risking matters as much as possible to pave the way for the successful restructuring on its projected timetable and without escalating costs.

Please note that guest content does not necessarily represent the views of the IPA.