Devon firm saved from administration in connected party pre-pack deal
MG Associates purchased by London accountancy firm in pre-pack deal, after being involved in “extensive litigation” for a number of years
A DEVON accountancy firm has been saved from going under after it was purchased in a pre-packaged deal, the administrator has revealed.
Michelle Weir, partner at Lameys Business Recovery was appointed as administrator of Devon-based MG Associates on 6 April.
According to the administrator, the accountancy business had in recent years been involved in “extensive litigation” which left the firm in an “insolvent position with a liability which it could not pay”.
The accountants has now been purchased by MG Accountants Limited, a company owned and controlled by the director of MG Associates’ wife. Staff will remain unchanged and business’ customers should experience almost no disruption to the service they receive.
The only real change following the deal is that MG Associates’ Dartmouth office has ceased trading and all its workload has been transferred to its Kingsbridge office. The firm’s Torquay office will remain unchanged.
Weir commented: “We are pleased to have been able to secure a sale of the business which will facilitate a return to the company’s unsecured creditors and saved jobs. The only real alternative was to liquidate the company and that would have been far worse for the creditors, staff and customers.
Weir added that “the best possible outcome” has been secured through the sale to a company which is connected to the company’s director.
“The business was extensively marketed before the administration and, whilst there was significant interest, the best offer was received from MG Accountants Limited,” continued Weir.