ERNST & YOUNG administrators have been called to Britain’s largest nightclub operator Luminar following the withdrawal of bank support earlier this week.
Alan Hudson, Tom Lukic and Alan Bloom, partners at E&Y, were appointed joint administrators to the collapsed operator of clubs such as Oceana and Liquid.
Nine subsidiaries are not yet in administration but are expected to enter the insolvency process later today.
Hudson said: “Luminar’s portfolio of night clubs will continue to trade as a going concern as we seek a buyer for the business. Whilst a strategic review of the portfolio will be undertaken, we are keen to stress to our customers planning to spend nights out in the venues this weekend and going forward that it is very much business as usual.
“The night club and bar sector is an extremely challenging and competitive sector and Luminar has struggled against a backdrop of increased competition and reduced disposable income from its customer base.
The company employs about 2,500 staff.
Earlier this year its lenders had granted a waiver to certain banking covenants on a three year credit facility which was due to end today. The lenders, including Lloyds TSB, Barclays and Royal Bank of Scotland, have refused to extend those waivers.
In August the company’s auditor PwC was succeeded by KPMG after it was asked to step down.
A statement from PwC said: “Our opinion in Luminar’s annual report for the year ended 26 February 2011 clearly highlighted the severe issues the company faced in relation to its ongoing business. We do not include emphasis of matter paragraphs lightly in audit opinions.”
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