Flooring wholesaler Selby Contract Flooring has been sold in a prepack deal after entering administration.
Colin Wilson and Ian McCulloch, both of Opus Restructuring LLP, were appointed as joint administrators of Selby Contract Flooring Limited on 16 July 2024.
Ahead of its administration, the £4m-turnover company faced significant cash flow challenges going into Q4 of 2023 and made a decision to reduce its workforce and overheads by 40%.
Since the start of 2024, new orders were weak and coupled with ongoing debt repayments from Covid loans, this resulted into the company needing to secure further funding to survive. This was not achievable and was deemed to be insolvent.
Upon entering administration, the business and assets were sold to a connected party, Selby Partners LLP, for a total value of £60,000, with £10,000 being paid upfront. The remaining balance is to be paid over three month instalments of £16,666.
As for creditors, preferential creditor, the HMRC, is owed £104,000 and is expected to be partly repaid from realised assets valuing £46,000. Unsecured creditor claims totalled £1.1m and included almost £500,000 owed in loans. It is expected that creditors will suffer a shortfall of £1.3m.
