crash2006 Posted February 23, 2007 Share Posted February 23, 2007 TGWU officials said the Department of Trade and Industry had paid out redundancy and notice pay, and pensions were still being looked into. found this pretty amusing. http://news.bbc.co.uk/1/hi/england/lancashire/6388109.stm Quote Link to comment Share on other sites More sharing options...
SarahBell Posted February 23, 2007 Share Posted February 23, 2007 As Harry would have said "tax free" Well ok, looks like he's dumped all the proiblems he had with debt? Quote Link to comment Share on other sites More sharing options...
DoctorJ Posted February 23, 2007 Share Posted February 23, 2007 This makes no sense to me at all. why would anyone do this? This guy has now had to buy the company again losing more money. apart from the fact that he might have saved 2 months of wages for the 300 staff. totally confused Quote Link to comment Share on other sites More sharing options...
greengreen Posted February 23, 2007 Share Posted February 23, 2007 I would imagine that the company probably had a lot of debt attached to it, so the management decided that it was no longer a viable business and put it into administration. They have probably done it so that the new company can right off as much debt as possible, and give them the opportunity to move the business overseas which perhaps would be a lot cheaper to do if they went into administration rather than paying redundancy to all the existing workers. Quote Link to comment Share on other sites More sharing options...
SarahBell Posted February 23, 2007 Share Posted February 23, 2007 No redundencys, no pensions debt, no other debt, but all the stuff to now move production abroad like he wanted to. Quote Link to comment Share on other sites More sharing options...
greengreen Posted February 23, 2007 Share Posted February 23, 2007 No redundencys, no pensions debt, no other debt, but all the stuff to now move production abroad like he wanted to. Yes, you are right. Quote Link to comment Share on other sites More sharing options...
DoctorJ Posted February 23, 2007 Share Posted February 23, 2007 Yes, you are right. I'm amazed that this type of thing is legal - is this the shape of things to come in the UK? Quote Link to comment Share on other sites More sharing options...
greengreen Posted February 23, 2007 Share Posted February 23, 2007 I'm amazed that this type of thing is legal - is this the shape of things to come in the UK? It is legal. I would imagine that the company had debts, perhaps to banks or investment companies that invested thinking that the company would eventually make a good return on that investment. I would guess that the directors eventually faced the fact that the company would not be able to service the debt / pay employees / pay suppliers based on existing and future sales and could not gain further investment. At this point if the company is then technically trading insolvently which is an offence, they would then have to go into administration. The administrators job is simply to gain the best value from the remaining parts. one example would be MFI: How does a company cost £1? Whats happened in this case is the debt the company had is probably written off, and the company was sold to the highest bidder - suprisingly the previous owner! If it can be shown that they were trading insolvently then the directors will be investigated, I would imagine they new exactly what they were doing. Quote Link to comment Share on other sites More sharing options...
Saving For a Space Ship Posted February 23, 2007 Share Posted February 23, 2007 A few years ago there was a big uproar about this type of buy-back when a sofa warehouse chain went into administration (may have been the leather sofa one) and the previous owner bought it back. There was a tv doc investigation, and it showed that the same owner had done this before. The interview with the administrator showed that his main obligation was to get the best price for the assets of the company, with no legal ban on a previous owner buy-back. They called for a change in the law , but obviously nothing has changed. I imagine it must be used as a tool to rid a company of debt, and be very difficult to prove that this was done on purpose. Quote Link to comment Share on other sites More sharing options...
MarkG Posted February 23, 2007 Share Posted February 23, 2007 What would you prefer: that the company shuts down for good, or that the old owner buys it back for a pittance and starts running it again? If the old owner was able to buy the company cheap then obviously no-one else had any interest in running it. If the banks lend lots of money to the new company and it goes bust again, that's their problem. Quote Link to comment Share on other sites More sharing options...
TeddyBear Posted February 23, 2007 Share Posted February 23, 2007 What would you prefer: that the company shuts down for good, or that the old owner buys it back for a pittance and starts running it again?If the old owner was able to buy the company cheap then obviously no-one else had any interest in running it. If the banks lend lots of money to the new company and it goes bust again, that's their problem. From what I read there were other bids and interest, the Russky with piles of questionable money bid higher than anyone else. Quote Link to comment Share on other sites More sharing options...
Let the Truth Begin Posted February 23, 2007 Share Posted February 23, 2007 The most UNRELIABLE car I've ever driven. The damn thing use to fall apart as I drove it. It depreciated in more than one way! If they keep building a shit car it'll end up in the toilet again. Quote Link to comment Share on other sites More sharing options...
adamUK Posted February 23, 2007 Share Posted February 23, 2007 No redundencys, no pensions debt, no other debt, but all the stuff to now move production abroad like he wanted to. If I was a creditor I would be furious. I hope he plans to buy all his parts from alternative suppliers. Otherwise it's going to be "cash up front" for everything. Adam. Quote Link to comment Share on other sites More sharing options...
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