ICSM logistics and haulage industry insolvency news: string of firms go into administration as a quarter of SMEs have ‘significant financial’ problems – plus a list of who has gone bust recently

The haulage and logistics industry is in crisis with driver shortages caused by Brexit and the Covid-19 Crisis plus the downturn in the economy in recent months.

Writing in Motor Transport Chris Tindall has reported on the collapse of the Welsh haulier Adrian Poole & Sons International based in two depots in Whitland and Llanfyrnach. Insolvency practitioners Mazars LLP have been appointed.

Chris Tindall explained that a voluntary arrangement with a supplier had not been kept to and earlier this year concerns mounted over other failings and the arrangement was ended. It is understood that a winding up petition against the company was made. He reported that the operator holds a standard international licence authorising a total of 25 HGVs and 30 trailers out of its two bases.

A pre-pack deal has been agreed by Clugston Distribution Services in is acquisition of failed Trans 2 Logisitics meaning some jobs have been saved. Leonard Curtis Business Solutions Group who handled the pre-pack achieved the deal the day before the firm was to go into administration. Motor Transport reported: “The company, which specialised in abnormal load transport and held an international licence authorising 12 vehicles and 12 trailers, had been suffering financial difficulties brought about by a loss-making contract in 2019, the Covid pandemic and Brexit uncertainty.”

There is a sorry tale of one haulier who decided to close their UK operation and open it in Germany. New Generation Courier Logistics (NGCL) fell foul of German employment law and opened warehousing which proved to be unprofitable. Desperate attempts were made to cut down on overheads but cashflow problems built up before the firm hit the buffers owing the taxman £3.4m according to Chris Tindall.

In a further report Tindall reports on how many hauliers have been hit by a variety of factors with thousands in a desperate financial straight. He reported: “There has been a jump of almost a quarter in the number of transport and logistics SMEs experiencing significant financial distress compared to the end of last year, according to a new analysis. RealBusinessRescue.co.uk, set up by Begbies Traynor to advise business leaders in financial distress, also said the number of start-up transport firms now struggling financially had increased by 60% during the last quarter, due to the pandemic. It said there were now 19,000 SMEs battling against insolvency, a rise of 24%. Significant distress was defined as businesses with CCJs of less than £5,000 filed against them, or else appeared to have sustained or marked deterioration in key financial ratios and indicators.”

Runners and Riders

Below is a collated list taken from the Government’s London Gazette of various businesses who are experiencing problems in the last few weeks.

LOGISTICS AND ALLIED INDUSTRIES
Administrators Appointed
Trans 2 Logistics Limited    09621600
Venian Warehousing And Distribution Limited    10439127
 
Creditors’ Voluntary Liquidation Deemed in Consent Meetings
Airline Taxis Limited    07884904
Dutch Logistics Limited    09443819
Fuel Specialist Cars Limited    10445328
JB Rail Solutions (Doncaster) Limited    09943848
JCM Transport Nantwich Limited    06623138
MW truck Assist Limited    10215056
Nosa Ajanaku Ajanaku Driver Services Limited    09528273
 
Liquidators Appointed
Annett Road Garage Limited    12235726
Bristol Freight Limited    11221639
DG Transport (Manchester) Limited    10145280
Easy Taxis (NW) Limited    12000235
Fast Despatch Logistics (Croydon) Limited    11612891
Fast Despatch Logistics (Dartford) Limited    11610277
Freight Fulfilment Limited    09789069
Hall’s of West Moors Limited    11512093
Hope Commercials Limited    04328571
IB&Co Services Limited    10146265
J A Plant Hire Limited    10512334
Johnston Rigging and Lifting Limited    09023277
LRP Transport Limited    11114389
Lutterworth Transport & Trailer Services Limited    06616698
MW Truck Care (Kent) Limited    12600098
MW Truck Care Limited    12280566
New Rodley Motors Ltd    07918673
Red Century Logistics Limited    07857556
Rhys Davies Freight Logistics Limited    01692338
 
Members Voluntary Liquidations
J.D. Birch & Son Limited    01194548
Autoteq Limited    01434750
Hobby Caravans (UK) Limited    01741984
Road Rail Services Limited    09160705
Stobart Rail Freight Limited    05961679
Stobart Transport & Distribution Limited    05907280
 

Types of Insolvency
Administration
Administration applies to limited companies and partnerships and is intended to get the company out of trouble and trading again if possible. Administrators can be appointed to a company that is unable, or is likely to become unable, to pay its debts. They can be appointed by the courts (on application from a creditor, directors or partners), the holder of a qualifying floating charge over the assets of the business, or the company or its directors. An administrator's primary goal is to rescue the company as a going concern. If this isn't possible, the administrator will try to get a better result for the creditors than would be possible if the company was wound up. If neither of these is possible, the administrator will sell the company's property to make at least a partial payment to one or more secured or preferential creditors, such as employees or the bank.
Administrators Meetings Para 51
This statement by the administrator of his proposals must be accompanied by an invitation to an initial creditors' meeting (Sch B1, para 51(1)).
Bankruptcy
This can only apply to individuals (including sole traders and individual members of a partnership). Bankruptcy petitions may be presented to the court by the individual, by creditors who are owed £750 or more, or by the supervisor of an individual voluntary arrangement. A bankruptcy order is made by the court.
Company Voluntary Arrangement (CVA)
A company comes to an arrangement with its creditors to pay the debts in full or in part over time. A CVA begins with the company (or its adviser) drafting a formal proposal at a Creditors' Meeting to pay part or all of the debts. If the proposal is accepted by the creditors, the arrangement will become legally binding and the directors will retain control of the company.
Compulsory Liquidation
This is the winding up of a company or a partnership by a court order (a winding up order). A petition is normally presented to the court by a creditor stating that he or she is owed a sum of money by the company and that the company cannot pay.
The Official Receiver becomes liquidator when the order is made but an Insolvency Practitioner will be appointed to take over if the company has significant assets. The liquidator's role is to realise the company's assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
Compulsory Liquidators Appointed S 136
When a winding-up order has been made, the Official Receiver is initially appointed as liquidator (section 136, IA 1986). The company's creditors and contributories may appoint another individual, who must be a registered insolvency practitioner, to act as liquidator (section 139, IA 1986). More than one liquidator can be appointed to act jointly.
Creditors' Voluntary Liquidation
Here the shareholders pass a resolution to wind the company up without the need for a court order. A Creditors' Meeting is held to nominate the appointment of a liquidator and consider a statement of affairs. Creditors can appoint a committee to work with the liquidator, whose role is to realise the company's assets, pay all the fees and charges arising from the liquidation, and pay the creditors as far as funds allow in a strict order of priority.
Creditors' Voluntary Liquidation Deemed in Consent Meeting
Creditors are now 'deemed to have consented' to a decision or resolution if 10% of creditors (by value) have not objected to it. In other words, if objections are not received by the specified decision date, creditors are 'deemed to have consented' to the decision or resolution.
Individual Voluntary Arrangement (IVA)
An individual comes to an arrangement with creditors to pay his/her debts in full or in part over time as an alternative to bankruptcy. The arrangement is set up by a licensed Insolvency Practitioner who will put it to a meeting of creditors. If the proposal is accepted at the meeting, the agreement reached with the creditors will be legally binding. An Interim Order is sometimes issued by a court and will immediately protect the debtor from any legal action by creditors.
Petitions to Wind Up
A winding up petition is a legal notice put forward to the court by a creditor. The application, in effect, asks the court to liquidate the company as they believe the company is insolvent. Proceeds of the liquidation can be used to pay back creditors.

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