Moore Stephens appointed to insolvent Reader's Digest
UK arm of Reader's Digest joins US parent in insolvency proceeding
Reader’s Digest in the UK has entered administration.
Insolvency practitioners from
Moore
Stephens have been appointed as joint administrators to the popular
brand known for its magazine, which has an estimated 500,000 subscribers in the
UK.
RD employs 117 staff in the UK, split between its Canary Wharf and Swindon
offices.
Phillip Sykes, Jeremy Willmont and Bill Beach of Moore Stephens were appointed
to the UK subsidiary of Reader’s Digest Association.
They will run the business as a going concern while inviting offers for the
business – as well as reviewing its financial position.
It was “too early to say” what impact the administration would have upon the
jobs, administrators said in a statement.
The US parent entered Chapter 11 bankruptcy proceedings last August, but
administrators in the UK were unable to comment on the impact of that event on
the UK insolvency filing.
The parent said that the UK board made the decision to enter administration
after failing to gain support from the UK pensions regulator over an agreement
reached between the UK business, its trustees and the Pension Protection Fund
over a longstanding pension liability.
The agreement involved the US parent paying a lump sum into the fund, plus
handing over an equity stake into the UK business, which would have relieved the
UK arm of “significant obligations” associated with its underfunded UK pension
plan.