KPMG pre-pack saves 4800 jobs at East London Bus Company
KPMG insolvency experts Jim Tucker and Chris Laverty sell East London Bus Company's four subsidiaries to Stagecoach using a pre-packaged administration process
KPMG insolvency experts have used a pre-packaged administration to preserve
4,800 jobs at the East London Bus Group, the the third largest bus operator in
London.
On being appointed today, joint administrators Jim Tucker and Chris Laverty
sold East London’s four subsidiary companies – East London Bus & Coach
Company, South East London & Kent Bus Company, East London Bus Limited and
East London Bus Group Property Investments – to transport giant Stagecoach.
The pre-pack process has attracted criticism
from
the government because of concerns it gave companies an easy way to offload
their debts and begin afresh.
However, insolvency experts have maintained that the process is an invaluable
tool which allows sale prices to be maintained and saves companies from
overheads such as costly rent payments.
Jim Tucker, joint administrator and restructuring partner at KPMG, said: ”
The company was bought near the peak of the boom and, unfortunately, after the
credit crisis took effect, the value of the business fell below the amount of
its debt.
“However, today’s sale has ensured business as usual at the operational part
of the business and stands the business in good stead for a successful long-term
future.”
No one was made redundant as a result of the pre-pack, KPMG added.
Further reading:
Pre-packs
up to the job, says trade body