Recruitment Company Saved Repays 50p in the pound in a CVA

paying back 50p in the £1
The agency’s senior manager contacted Keith Steven of KSA. After a subsequent telephone conversation with KSA Regional Manager, Malcolm Gray, a meeting was requested and held between the senior manager of the company and Malcolm Gray of KSA group.
KSA were appointed to assist the company with the production of CVA proposals on 26th February 2013.

So what were the causes of the problems?

1.  Turnover to 30th September 2012 was c. £467k which was a fall of £80k compared with the previous year.
2. Sales to 30th September 2013 were forecast to be a modest rise of c. £20k
3. Providing financial support to an associated company which has since ceased trading.
4. Sale of premises at £100k less than initially invested.
5. Threats of a Winding up petition from HMRC.

Who was owed what?

The bank was secured with a debenture first registered in 2001 and provided £15k overdraft facility but the invoice finance facility had been withdrawn.

However, KSA introduced a new invoice finance provider who could fund the requirements of the company in a CVA. If you want to know more about funding see our finance page
100% of the unsecured debt was owed to HMRC totalling £105k

The CVA meant that KSA assisted in saving 42 jobs. – HMRC approved the CVA with standard modifications on 8th October 2013. Consequently the CVA was approved at the creditors meeting on 9th October by the body of creditors (HMRC) with a dividend of 50p in £1