The Public Relations (PR) company representing embattled beds retailer Dreams has underlined that the company is “not in administration” at present.
While the situation may change, Tulchan Communications – which is representing the nationwide bedroom furniture specialist – told Insolvency News that the company has not yet entered a formal insolvency process.
Dreams and its parent company has been late filing its 2011 accounts so the latest information available to suppliers, landlords and credit insurers are only the trading figures and the balance sheet as at December 2010. These were due to be filed by the end of September 2012.
Nick Hood, business analyst, Company Watch, said: “The issue for all the stakeholders is how to judge whether to go on supporting this business or not.”
He added: “The fundamental problem here is that Dreams has been struggling right through the long retail recession to generate enough profit to service the huge debts that it took on when it was bought by Exponent Private Equity in 2008.
“The magnitude of the task facing them is illustrated by the fact that the group had an interest charge of over £30 million in its last set of accounts. While Dreams itself made a profit of over £4 million, this is a drop in the ocean against an interest burden like that.”
Media reports elsewhere have alluded to a significant event likely to affect the business in the coming days.
However, Lucy Legh, consultant at the company’s PR firm Tulchan Communications, said: “I am representing the company and, at this time, no deal has been signed. I have to stonewall you really in these situations because I can speculate, but that is not going to do anything really.
“It is very well documented that Dreams has been in a sale process. No deal has been signed but there are still other people waiting in the wings.”