Pawnbroking business Albemarle & Bond has appointed administrators after its lending banks were unable to support a management turnaround plan.
The company filed a notice of intention yesterday (25 March) to appoint four insolvency practitioners from PwC as joint administrators to Albemarle “as soon as is practically possible”.
In an update, it revealed there would be “no realistic prospect” of any value being attributed to ordinary shares.
Mike Jervis, Peter Dickens, Toby Underwood and Stuart Maddison of PwC have been appointed as joint administrators of Albemarle & Bond Holdings plc, Albemarle & Bond Jewellers & Pawnbrokers Limited and Herbert Brown & Son Limited, which trade as Albemarle Bond and Herbert Brown today (26 March).
Jervis, joint administrator and partner at PwC, said: “The group expanded its branch portfolio in the period to early 2013 and ended up with too many underperforming outlets. It then explored a rights issue to raise funds, before attempting a solvent sales process. Together, these efforts lasted more than six months. Despite this history many different parts of the group, and large swathes of its shops, remain profitable.
“Our priority is to keep all pledged items safe and available for redemption as normal. We plan to sell all or part of the business to protect as many jobs as possible and we have already paid, or will be paying all staff – including accrued bonuses – as normal in March. Also, all landlords have been paid.
“However, some redundancies may be necessary depending on the outcome of efforts to sell the business. Every branch will initially remain open as sale discussions progress. This also enables customers to continue to redeem their goods as normal as they pay off their loans.
“The group and PwC are doing all that they can to support employees through this difficult time and will work with government agencies in order to support anyone affected by potential redundancies.”
The board was informed on Monday (24 March) that the company does not consider the possible options being explored by its lenders and the board as “capable of being completed”.
A statement said: “As a result and due to the continuing trading losses of the company, the board has concluded not to request a further extension of the covenant deferral beyond 31 March 2014.
“Consequently, and in the absence of any other available facilities from its lenders or elsewhere, the company will shortly be unable to meet its liabilities as they fall due.”
The company ran into trouble last year when it revealed it was melting down gold reserves to raise cash and put itself up for sale in December.
By Ellie Duncan