East Kilbride-based company Enterprise Foods Limited has collapsed into liquidation – as many as 71 staff have been made redundant after 35 years in business
A major UK food company has collapsed into liquidation after being in business for 35 years.
Scottish firm Enterprise Foods Limited helped suppliers and producers get goods onto the shelves of major retailers. As many as 71 staff have been made redundant after it went bust.
The East Kilbride-based company traded as Localist and fell into financial difficulty after failing to refinance debts of more than £5million. George Lafferty of BTG was appointed provisional liquidator on Wednesday after a petition was lodged by the company.
The company had been struggling with cash-flow problems that had built up over several years. These were linked to debts following the failure of numerous customers and were worsened by challenging market conditions hitting both the retail and hospitality sectors. The collapse marks the end of a long-standing Scottish foodservice business and raises fresh concerns over pressures facing firms across the sector.
Thomas McKay, managing partner of BTG in Scotland and Northern Ireland, said staff are being supported following the collapse.
He said: “The directors had made efforts to restructure the debt of the company in order to save the business and rescue the jobs, and the loss of the jobs was sadly inevitable when this was not successful.
“There are many small suppliers to the business that are owed money, and the loss of this route to market will also have a serious knock-on effect to these food producers as well.
“We are working to assess all claims and establish whether there will be any dividend paid to unsecured creditors. But it is not likely to be significant, given the level of secured debts in the business. Regrettably, the failure of the company has resulted in 71 redundancies.
“We are working closely with those affected to help them access the financial entitlements and support available to them, including assistance from Partnership Action for Continuing Employment (PACE) and the Redundancy Payments Service.
“Our priorities now include ensuring these employees receive the guidance and advice they need during this process, and that we maximise the return from the sale of assets to the benefit of creditors.”
This comes after a UK airline plunged into administration having been in business since 1997. Eastern Airways first suspended operations in October before entering administration in November. It had been based at Humberside Airport in North Lincolnshire and operated regional services from airports across the United Kingdom.
All of its flights were cancelled as a result. It had services right across the UK, Europe and Ireland. Administrators said the airline was left with a cost base that was “too high to be sustainable” after a contract to operate services for Dutch airline KLM was ended.
Speaking to the BBC at the time, Jamie Miller from RSM UK Restructuring Advisory, who was appointed joint administrator, said sufficient staff had been retained to maintain the fleet while they sought to rescue some or all of Eastern’s operations.
