Former Haines Watts unit heading for CVA

A former business unit of top 20 firm Haines Watts Group is heading into a company voluntary arrangement (CVA) with debts of more than £4m.

The unit, a grouping of Haines Watts practices previously called HWCA Ltd, was formed in 2005. But it struggled. Last August HWCA’s practices were transferred back out to Haines Watts’ regional businesses through management buyouts. The remaining shell, renamed Sixonethreeone, was left with more than £4m in assets from the buyouts.

Total liabilities will exceed the assets when the costs of entering Sixonethreeone into a CVA are taken into account. Accountancy Age understands that HMRC is owed £1.9m by Sixonethreeone, plus a further £1.9m to former directors.

Geoffrey Fairclough, chairman of Haines Watts Group has stressed that Sixonethreeone’s impending CVA would have no impact on the firm.

“The issues at Sixone­threeone have no impact on Haines Watts’ businesses, which all continue to trade normally,” said Fairclough.

Sixonethreeone also faces a winding-up order from former director Manish Patel for £73,000 to be heard in the courts on 24 March. However, it is expected that a creditor meeting to approve the CVA will take place before that date.

The most recent set of accounts filed by HWCA Ltd prior to changing its name to Sixonethreeone, was on 31 March 2008.

A statement in the HWCA accounts claimed 2008 was the first year to show a profit on its balance sheet due to an injection of more than £2m as share capital and converting £2.5m of borrowings to a five year loan.

The group consists of over 60 owner-managed firms through­out the UK.

Further reading:

Tenon snaps up Haines Watts Business Recovery