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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 | 16-Feb-2011 11:07 am

    He's also acting for the University of Salford in the libel claim against a former lecturer

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  • Comedy Hour | 16-Feb-2011 12:13 pm

    I am also taken by some of the amusing statements. People do not seem to understand what it going on here.
    1. The sale of the assets resulted in a deal whereby the partners who moved to Hill Dicks, Barlows and Gateley Wearing would see their practice loans repaid. The payment would come from realisations from the assets. Is that fair when you take into account the reverse premium received by some of those partners and the huge losses incurred by creditors?

    2. The partners who were there when the ship went down have the ability to claim terminal loss relief. This includes the ones who took the £20M reverse premium. Is that fair when considering the position of the creditors?

    3. Those who took the reverse premium may see a cash neutral position and get the benefit of terminal loss relief so they lose nothing. Is that fair.

    Nobody in the press has really got to grips with the tax position and the application fo terminal loss relief. Tax rebates loom large which means even less money for hospitals etc.

    Whose laughing now?

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  • Anonymous | 16-Feb-2011 6:27 pm

    @9.56 am. On twelve separate occasions today. Alas reverse premium / lottery win is but a pipe dream and I shall have to keep at the drudgery for a living.
    The Lawyer omits to mention that the Landlords (assuming that they are admitted for this top line number) may get as much as (by very, very rough sums assuming an even split in the rentals and a full prescribed part, which is no certainty by the sound of it) a quarter's rent each out of the process.

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  • Hugey | 16-Feb-2011 7:02 pm

    Well bad innit. Wotevs.

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  • Daylight Robbery | 16-Feb-2011 9:03 pm

    That's what it is.

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  • Anonymous | 17-Feb-2011 2:55 pm

    Where's Alec Craig?
    Do you think he should be reported to the police as a missing person?

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  • Anonymous | 17-Feb-2011 4:21 pm

    Alec Craig is probably still wafting around the streets of Alderley Edge in a powder blue Bentley convertible acquired at about the time the Halliwells' equity partners received their bunce from Spinningfields.

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  • AA | 19-Feb-2011 1:03 pm

    What does the chair of the Salford Uni audit committee do? Is part of the job to advocate restraint? Wouldn't mind seeing the job description.

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  • Impy | 20-Feb-2011 7:02 pm

    What were they thinking? A total lack of sensible management laced with a large portion of greed.

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  • Anonymous | 21-Feb-2011 12:43 pm

    Salford Audit Committee: "The Audit Committee is responsible to Council for adequate and effective risk management, control and governance (including ensuring the probity of the financial statements and the effective management and quality assurance of data submitted to funding bodies) and for the economy, efficiency and effectiveness of the institution's activities."

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