Following their appointment as joint administrators for Ince on 28 April 2023, Andrew Hosking and Sean Bucknall of Quantuma Advisory have filed a statement of administrator’s proposal (the Quantuma proposal) at Companies House.
A pre-pack sale of Ince’s business and assets to Axiom Ince has now been completed. The Quantuma proposal states: ‘Of the total sale consideration of £2,200,000, £1,000,000 has been received to date and the remaining £1,200,000 will be collected as and when it falls due for payment.’
Ince owes secured creditors a total of £16,854,792 in banking debt at the date of the appointment of the joint administrators. This includes an estimated £15,000,000 debt owed to Investec Bank.
The firm does not have any preferential creditors. All its employers were TUPE transferred to Axiom Ince and there are therefore no preferential claims.
However, HMRC is a secondary preferential creditor and is expected to make a claim of around £15m. This includes liabilities for VAT, PAYE income tax, employees’ NIC, CIS deductions and student loan deductions. A Compass Evaluator report filed with the Quantuma proposal and commissioned by Tony Mead, a director at Axiom Ince, detailed the challenges faced by the beleaguered firm. It notes that while Ince had been hoping to find a solvent trade on solution, its considerable arrears with HMRC have proved challenging.
The directors of Ince had sought a time to pay agreement for the arrears to avoid administration but this was rejected by HRMC. ‘Enforcement action is imminent,’ according to the report. Additionally, the report highlights that the audited accounts for the year ended 31 March 2022 are outstanding and ‘the shares have been suspended since 3 January 2023.’.
The total owed to creditors amounts to £41,188,082.40. The firm has accumulated a wide range of creditors during its troubles, including individuals, universities, law firms, and The Law Society.
The Quantuma proposal states ‘it is anticipated that there will be insufficient funds to pay a distribution to secondary preferential creditors in full or the unsecured creditors.’
To conclude the administration the remaining deferred consideration from the purchaser, amounting to £1,200,000, needs to be collected. The joint administrators will also need to discharge their statutory duty to investigate the affairs of Ince. The Quantuma Proposal states: ‘the administration is expected to conclude in c.30 months by exiting to dissolution.’
This article first appeared on Legal Business