A £4.6m SHORTFALL TO CREDITORS has been discovered by Grant Thornton administrators working on the collapse of financial advisory business Honisters Capital.
The company entered administration on 3 July with Grant Thornton partners Nigel Morrison, Alistair Wardell and Richard White, jointly appointed.
According to a creditor report and statement of affairs by the administrators, there is a £4.6m shortfall on the amount of assets available and what can be paid to creditors. So far, unsecured creditor claims such as that owed to the taxman (£186,000), traders and IT contracts are estimated to be about £5.7m.
Grant Thornton administrators believe there is just £1.3m in assets for realisation to pay unsecured creditor liabilities – there are no secured creditors, such as lenders.
The administrators have billed £204,000 for time costs to 31 August, and £29,000 for pre-appointment time costs.
Earlier this year, the administrators warned there would be insufficient funds to meet creditor claims and that the Financial Services Compensation Scheme would need to pick up the shortfall.
A spokesman for the administrators at the time said: “Honister Capital is insolvent – it can’t meet its existing claims and the administrators expect the claims to accelerate in the future. We anticipate claims to escalate in due course and the FSCS will need to take claims.”
On 19 June, Grant Thornton were called to look at the financial health of the business. Honister was concerned it would be unable to continue trading when its professional indemnity insurance expired and the existing provider declined to renew, in early July.
Shortly after this meeting the company entered administration, putting about 930 advisory jobs at the business at risk.
Manufacturer DMG Steelworkers has been sold out of administration in a pre-pack deal by insolvency and restructuring firm CVR Global
By threatening creditor returns, the government could undermine the UK’s World Bank insolvency ranking and cost creditors £8m a year, trade body R3 warms
Lee De’ath and Richard Toone, partners at CVR Global, were appointed joint-administrators of Lexden Centre (Oxford) Limited, trading as Colchester English Study Centre (CESC), on 29 June 2016
Peter Saville, Ryan Grant and Anne O’Keefe of AlixPartners will now become the supervisors of the CVA and monitor the implementation of the proposal