Kitchen furniture firm Ashton Bespoke was sold in a prepack deal after being placed into administration.
Paul Ellison and Chris Errington, both of KRE Corporate Recovery Limited, were appointed as administrators of kitchen furniture manufacturer Ashton Bespoke Limited on 17 October 2024.
In the build up to its administration, the company experienced a decline in turnover caused by the general economic climate and cost-of-living crisis, resulting in a reduction in demand. In addition, increased trading costs had resulted in losses being made and cashflow issues.
The company had seen sales reduce from £1m to around £400,000 at the time of its collapse, with losses amounting to £115,000.
A time to pay arrangement was agreed with the HMRC, however the company defaulted on the arrangement in October and therefore became subject to a potential winding up order. Rent arrears were also owed to its landlord with the company beginning to come under external creditor pressure.
Upon appointment of administrators, the business and assets were sold to Joinery Lab Ltd, an unconnected company, for a sum of £25,000, which was paid in full. The deal saved 10 jobs.
“The benefits of achieving a pre-packaged sale were the transfer of the employees and the absence of a break in supply of goods and services, which would enable a value to be achieved for goodwill and ensure a more effective debt collection process,” the administrators said.
As for preferential creditors, the HMRC is owed £279,000, while unsecured creditors are owed £99,000, which included £31,000 owed to Santander Bank. It is expected that creditors will suffer a shortall of £362,000.
