Plug Bathroom Interiors Ltd (06857294): administration
- Status
- Administration ended
- Administration began
- 2011-05-13
- Administrators
- Situl Devji Raithatha
- Administrators' firm
- Springfields Business Recovery & Insolvency
- Incorporated
- 2009-03-24
- Location
- Leicester
- Industry
- 7487
Why it went into administration
- Funding withdrawn / unable to refinance
- Cash flow / liquidity pressure
- HMRC / tax arrears
- Credit insurance / supplier credit withdrawn
From the administrators' statement
The Company was formed and founded in March 2009, initial investment for the Company, in the region of £80,000, came from the shareholders During March and June 2009 the directors had been looking at properties to lease to develop an upmarket bathroom showroom. Through the Company’s accountants the directors heard that J Farthing Ltd, a long established plumbing and heating business was in financial trouble and looking for a buyer. Following several meetings it was decided to purchase the business and certain assets of J Farthing Ltd as it had space where the bathroom showroom could be developed. It was also considered that there were synergies to owning a plumbing and heating business and a bathroom sales / installation business. The directors anticipated that the plumbing and heating side of the business could trade and help with cash flow, particularly during the showroom refurbishment The purchase was completed on 3 June 2009 At this time the leasehold property where the bathroom showroom was located was transferred into the Company’s name
Initially the plumbing and heating business traded well but soon these sales started to dry up, during June 2009 to February 2010 the showroom was being renovated so there were very few bathroom sales With the showroom re-fit and the overheads associated with the plumbing and heating side, the business soon started to struggle to make a profit. The shareholders were not able to make further investment and the Company suffered cash flow problems
The plumbing and heating side of the business continued to struggle and the number of staff was reduced to a minimum so as to take pressure off the total overheads, however, turnover still did not cover the overheads During this period the directors discovered that under the Transfer of Undertakings (Protection of Employment) Regulations the liabilities of the staff which had been employed at J Farthing Ltd were carried over to the Company when the business was transferred. This had not been expected and meant that funds had to be paid out directly from the Company’s working capital to discharge redundancy costs not originally foreseen.
Administrators' statement of proposals (2011-05-27) · Companies House register