US-based Federal Mogul has 133 UK subsidiaries and went into administration and bankruptcy on 1 October, the beginning of the fourth quarter. But government calculations record the company’s administration as 133 separate administrations, distorting figures.
A total of 3,798 companies became insolvent last quarter, up 1.8% on the previous quarter. If Federal Mogul had been counted as one company, the figure would be 3,666, fewer than the third quarter.
Businesses have been hit hard since 11 September. UK tourism has suffered, resulting in falling revenue in areas such as luxury goods, hotels and restaurants.
Insolvency practitioners say the figures, published last week, do not reflect reality because it is one group that has gone under, not several companies. Keith Goodman, president of the Insolvency Practitioners Association told Accountancy Age: ‘If there is a group of companies which have a large number of subsidiaries, such as Federal Mogul, it will show a large number of insolvencies.’
The IPA president said the rise was not surprising. ‘Everyone was expecting it. 11 September topped it for a lot of UK companies.’
Steve Absolom and Will Wright from KPMG Restructuring have been appointed joint administrators to City Motor Holdings and associated companies
Partners from Johnston Carmichael have been appointed as joint administrators to Axon Well Interventions Products UK
Begbies Traynor have been appointed administrators of William Anelay Ltd, York, one of Britain’s longest-established construction and heritage restoration companies
Smith & Williamson has been appointed administrators of charity 4Children