KSA Group persuades HMRC not to advertise a winding up petition issued against a haulage firm
We were approached by a North London haulage firm specialising in delivery to retail outlets. HMRC had already served a winding up petition on the 12th October and the advertising date was set for 19th November with a hearing date on the 2nd December. The advertising date is crucial as if the petition was advertised the bank would freeze the company's accounts.
The business was suffering for a number of reasons; It was under capitalised, it had high maintenance costs of an ageing fleet and high costs of subcontracted drivers.
KSA group advised on the options. However, once a winding up petition has been served then the business cannot go into creditors voluntary liquidation and if the petition is advertised then a CVA is very difficult given the timeframe available. Under these circumstances administration is likely to be the only option, with its higher costs, leading to a much lower dividend for unsecured creditors.
KSA Group advised that a CVA could be put together quickly as the company was viable going forward and there was a good chance of a high dividend. Stuart Nicholls of KSA Group set about to persuade HMRC not to advertise the petition. We have an excellent relationship with HMRC as they know we can help companies. Stuart produced the draft CVA on the 17th November. HMRC did not advertise the petition. A creditors meeting was held on the 15th January 2010 and the CVA was approved with the unsecured creditors getting 45p in the pound over 5 years. This amounted to over £90k. The company is still trading well in its second year of the CVA.
Call KSA Group on 0800 9700539 and talk to the experts.