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Halliwells' administrators seek funds to cover £200m of debts

15 February 2011 | By Luke McLeod-Roberts

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Failed firm Halliwells owes creditors a total of around £200m, a letter from its joint administrators has revealed.

BDO partners Dermot Power and Shay Bannon, who were appointed joint administrators of the firm last year, have contacted all known creditors stating that they have received unsecured claims totaling £191,521,921.

The sum is much greater than the £14.1m that was initially believed to be owed to unsecured creditors including HM Revenue & Customs and the landlord of the firm’s former headquarters at Spinningfields (20 September 2010).

The higher figure is believed to have been calculated by taking into account the remainder of the term of all leases, some of which have as much as 20 years left on them.

The document, seen by The Lawyer, claims that £176,499,347 is owed to landlords and £5,679,582 to lease creditors, while HMRC is owed £4.3m in tax and £1.2m in VAT, it is alleged.

In November RBS, which is owed £17.7m, was one of several creditors to form a committee to try to recover funds. Other creditors on the committee are: HMRC; a German fund run by Credit Suisse Asset Management, which is the landlord of the firm’s former headquarters at Spinningfields; ING Lease UK; and Halliwells’ Liverpool landlord, Bruntwood 2000 Beta Portfolio (22 November 2010).

The administrators’ letter also indicates that to date a total of £4.3m has been received from selling off parts of the business. Hill Dickinson paid £1.4m, Kennedys £197,000, BLG £1.25m and HBJ Gateley Wareing £1.5m. The administrators expect to receive a total of £7.4m from the law firm purchasers.

An additional £200,000 has been made from selling company cars and the administrators are also hoping to recover funds from the sale of Wembley corporate hospitality tickets.

While many jobs were saved through the sale of the business, the letter discloses that 22 per cent of all employees lost their jobs. Out of 671 employees, 83 redundancies were made when the firm went into administration on 20 July 2010, and a further 66 jobs were lost after a transitional period expired in the autumn.

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Readers' comments (34)

  • Anonymous | 15-Feb-2011 4:23 pm

    It has been known to happen that admins keep significant creditors onside by making noises about their admitted claim if said creditors happened to sit on a committee that approves said admins drawings for remuneration. But obviously not here.
    Landlords have also been known to hide behind rates and other voids by leaving the lease in the bust vehicle until re-let. But obviously not here either. It would be inappropriate to suggest that here. So I am not.

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  • Anonymous | 15-Feb-2011 5:34 pm

    How much did Robert Maxwell go down owing?

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  • Ashley Balls | 15-Feb-2011 8:49 pm

    Whether or not the unexpired portion of the lease can or cannot be counted it is very clear that the partners of what turned out to be a moribund organisation in management terms should have to carry the equivalent of a 'health warning'. Surely no first rate firm would have taken a Halliwells partner to thier bosom without first checking their credentials. Or would they?

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  • Solicitors Toothless Authority | 15-Feb-2011 8:57 pm

    What's the SRA up to? zzzzzzzzzzzzzzzz

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  • The reverse premium crew | 15-Feb-2011 9:44 pm

    Ian Austin, take a bow son, take a bow

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  • CVA E-Bay | 15-Feb-2011 9:51 pm

    I bid £12.50 for the next Iggy Pop concert at Wembley.

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  • Drum | 16-Feb-2011 8:22 am

    It will be interesting to know if any PGs have been given by any "partners" at Halliwells and if it is likely anyone will be subsequently be made bankrupt as a consequence. When Fox Hayes went down the tubes Steven Coupland was made bankrupt shortly after so it can not be ruled out.
    Any inside information !

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  • Anonymous | 16-Feb-2011 9:56 am

    The anonymous post at 4:23 pm on 15 February had me rolling on the floor with laughter!
    Like me, you're obviously a lawyer with experience of such things that never happen. Unlike me, you're a talented comedy writer. Have you thought about giving up the day job?

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  • Anonymous | 16-Feb-2011 10:32 am

    So which firm is next to go down the tubes?

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  • Anonymous | 16-Feb-2011 10:38 am

    He's still Chair of Audit at Salford....

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