Moore Stephens appointed to insolvent Reader's Digest

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.