Palmer and Harvey (P&H), which is the 5th largest privately owned company, has gone into administration with the loss of 2500 jobs. The business was in last-ditch talks with private equity firm Carlyle but these have failed at the last minute. Palmer and Harvey was the UK's largest distributor of tobacco and drink products to chains corner shops around the country. It supplied over 90,000 outlets
Administrators at PWC have been called on instruction by the directors as they owed significant sums to suppliers. The most likely scenario is that the supplier was about to issue a winding-up petition against the company. By going into administration this has stopped any further actions but given the large loss of jobs, it is unlikely the business will survive.
PwC said the group had been "hit by challenging trading conditions in recent months and efforts to restructure the business have been unsuccessful. This has resulted in cash flow pressures and it has not been possible to secure additional funding to support the business."
Many wholesalers and distributors are under pressure as a result of competition by Amazon and the discount supermarkets, Lidl and Aldi. Tesco recently bought the distribution firm Booker.
If you are an employee of the business then read our help for employees pages in insolvency situations