Unsecured creditors of UK Flooring Direct will not receive any money, while its administrators will not recover their fees, despite the company being sold for £6.4m to Nestware.
In a report to creditors, Teneo Financial Advisory says that UKFD lost £3.1m in 2021 and £2.7m in 2022 and received a £2m loan from Business Growth Fund in December 2022. BGF has bought a 14.5% stake in 2020 for £8m.
However, UKFD owed HMRC £2.8m, which had rejected the company’s fifth attempt to reschedule the debt. The company also lost credit facilities from its suppliers as it was unable to file its accounts after its auditors doubted its going concern status.
BGF then turned down a request for a further £3m, despite UKFD moving to EBITDA profitability.
UKFD had debts of £10.3m at the time of its administration. Of these £8.55m were secured with HSBC owed £2.55m and BGF owed £6m, including a £4m bill in the event of default on its £2m loan.
Teneo Financial Advisory says it does not expect these debts to be repaid in full. It also says HMRC will not recover all of its debt and the 100 unsecured creditors owed £3.7m will receive nothing.
Google is UKFD’s largest unsecured creditor, owed £669,032. Other major creditors are delivery companies.
Teneo Financial Advisory told creditors that it estimates its fees to total £507,236.
